Step up

The tax law for many years has included something called step up basis. This means that if I purchase an asset say land for $100 per acre and sold it today for $500 per acre, I would pay a capital gains tax on the $400 profit. If I waited until I died I could pass this land onto my heirs without paying any tax. The same is true for any asset, things like stocks and bonds. Biden is proposing a new 20% tax on people whose income is greater than $100 million dollar per year but they will develop ways to avoid much of this so it will not be as effective as planned. The second part of his plan is to tax people on unrealized gains. This means they will pay capital gains tax on any assets that have appreciated even if the don't sell them. This will in essence remove the step up basis since they will pay tax each year as the value increases and this will be effective. It only applies to the super rich which polls say people are all for. Of course people are normally for tax increases on someone else.