Section 1 Short title
This Act may be cited as the “Exit Tax Prevention Act of 2021”.
Exit Tax Prevention Act of 2021
A BILL
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.
Sec. 2 Prohibition on certain State and local taxation
A State, or taxing jurisdiction in a State, may not impose an obligation for the collection of an income tax, wealth tax, or any similar tax on a resident who has relocated permanent residence to another State or a taxing jurisdiction of another State.
Sec. 3 Definitions
For purposes of this Act:
Income tax— The term “income tax” has the same meaning given to it by the taxing jurisdiction in which the resident lives.
Resident— The term “resident” has the same meaning given to it by the taxing jurisdiction in which the resident lives.
Similar tax— The term “similar tax” means any imposed tax on an individual relating to the net wealth, value of held assets, or annual income of such individual.
Taxation jurisdiction— The term “taxing jurisdiction” means any of the several States, the District of Columbia, any territory or possession of the United States, or any municipality, city, county, township, parish, transportation district, assessment jurisdiction, or other political subdivision within the territorial limits of the United States with the authority to impose a tax, charge, or fee.
Wealth tax— The term “wealth tax” means any imposed tax on an individual’s net wealth or value of held assets.