Exit Tax Prevention Act of 2021

I 117TH CONGRESS 1ST SESSION H. R. 2165 To limit the authority of a State or other related taxing jurisdiction to impose a tax on a resident who has relocated permanent residence to another State or its related taxing jurisdiction. IN THE HOUSE OF REPRESENTATIVES MARCH 23, 2021 Mr. SCHWEIKERT (for himself, Mr. PERRY, Mr. MANN, Mr. C. SCOTT FRANK- LIN of Florida, and Mr. HICE of Georgia) introduced the following bill; which was referred to the Committee on the Judiciary A BILL To limit the authority of a State or other related taxing jurisdiction to impose a tax on a resident who has relo- cated permanent residence to another State or its related taxing jurisdiction. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Exit Tax Prevention 4 Act of 2021’’. 5 VerDate Sep 11 2014 01:00 May 21, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2165.IH H2165 pbinns on DSKJLVW7X2PROD with BILLS 2 •HR 2165 IH SEC. 2. PROHIBITION ON CERTAIN STATE AND LOCAL TAX- 1 ATION. 2 A State, or taxing jurisdiction in a State, may not 3 impose an obligation for the collection of an income tax, 4 wealth tax, or any similar tax on a resident who has relo- 5 cated permanent residence to another State or a taxing 6 jurisdiction of another State. 7 SEC. 3. DEFINITIONS. 8 For purposes of this Act: 9 (1) INCOME TAX.—The term ‘‘income tax’’ has 10 the same meaning given to it by the taxing jurisdic- 11 tion in which the resident lives. 12 (2) RESIDENT.—The term ‘‘resident’’ has the 13 same meaning given to it by the taxing jurisdiction 14 in which the resident lives. 15 (3) SIMILAR TAX.—The term ‘‘similar tax’’ 16 means any imposed tax on an individual relating to 17 the net wealth, value of held assets, or annual in- 18 come of such individual. 19 (4) TAXATION JURISDICTION.—The term ‘‘tax- 20 ing jurisdiction’’ means any of the several States, 21 the District of Columbia, any territory or possession 22 of the United States, or any municipality, city, coun- 23 ty, township, parish, transportation district, assess- 24 ment jurisdiction, or other political subdivision with- 25 VerDate Sep 11 2014 01:00 May 21, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2165.IH H2165 pbinns on DSKJLVW7X2PROD with BILLS 3 •HR 2165 IH in the territorial limits of the United States with the 1 authority to impose a tax, charge, or fee. 2 (5) WEALTH TAX.—The term ‘‘wealth tax’’ 3 means any imposed tax on an individual’s net wealth 4 or value of held assets. 5 SEC. 4. EFFECTIVE DATE; APPLICATION. 6 (a) EFFECTIVE DATE.—This Act shall apply to cal- 7 endar years beginning after December 31, 2021. 8 (b) APPLICATION.—This Act shall not apply to any 9 tax obligation that accrues before January 1, 2022. 10 Æ VerDate Sep 11 2014 01:00 May 21, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6301 E:\BILLS\H2165.IH H2165 pbinns on DSKJLVW7X2PROD with BILLS