...For instance, here’s a bit from the Wall Street Journal’s analysis of the House plan.
Take a simplified example of $2 million, received at the relevant top rates, by five different people: a salaried executive; the owner-operator of a manufacturer; an investor receiving dividends; a passive business owner, such as one who has a stake in a real-estate property; and an heir from a large estate.
Under the GOP plan, the executive would pay $868,000 in taxes, according to a rough calculation by Tony Nitti, of WithumSmith + Brown, an accounting firm. The manufacturer pays $704,400, but might be able to argue her way into a lower bill. The passive business owner pays $576,000. The dividend-earning investor pays $476,000. The heir to the estate pays nothing. The manufacturer, the estate and the passive owner all get big tax cuts from the GOP plan. The investor and the wage earner generally don’t.
So, five different wealthy people who make $2 million would pay anywhere from zero up to $868,000 in taxes, depending on occupational and investment decisions they made years ago and can’t possibly change now.
Remove the inheritance, since it’s probably a one-time event, and the range is still $476,000 to $868,000 for the same amount of income.
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