Paying the Fair Share Act
The text of the Paying the Fair Share Act was finally released, and it's pretty close to as-advertised. The gist:
- minimum tax is 30% of AGI once a taxpayer hits $2MM in AGI.
- tax phases in between $1MM and $2MM of AGI
A few comments:
- Because of the phase-in, the effective rate on AGI between $1MM and $2MM is pretty high. On a hypothetical NYC resident taxpayer w/ $1MM of long-term capital gains and $250K of non-charitable deductions, the effective rate goes north of 60%. Let's say that again: 60 fucking percent.
- There's a pretty egregious error: the law disallows all credits except for foreign tax credit, something random that I don't remember, and certain oil credits (sketchy). It doesn't except credits for overpayments from previous years, which is pretty fucking stupid.
Not terrible, but it could use a longer phase-in and should include credits for overpayments applied.