Only 500 households in New York City will pay the highest rate in Cuomo’s millionaire tax increase

Aside from being loaded, what do people like Michael Bloomberg, Julia Koch, and Leonard Lauder have in common? Former New York City Mayor, David H. Koch Foundation President and the man who helped grow the Estée Lauder Companies EL, +0.56% at a cosmetics giant are looking at tax increases from the state New York that could make them pay the highest personal income tax rate in the country.

At a time when more lawmakers in state and federal governments are considering tax increases, leaders like this trio are ultra-exclusive examples of the exclusive club that is on the receiving end of Gov. Andrew Cuomo’s proposed rate increases. The so-called millionaire tax will likely affect nearly 123,000 New Yorkers statewide. But the number of millionaires who will pay higher taxes decreases when you look at the super-wealthy residents of New York City.

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“The number of millionaire taxpayers declines when looking exclusively at the super-wealthy residents of New York City. ”

An estimated 15,165 city taxpayers are heading for a tax increase, based on 2019 tax return data from the New York City Independent Budget Office. Of those, 529 households in the city would pay the maximum rate for those who earn more than $ 25 million a year. That crowd could fit into one of Carnegie Hall’s small 599-seat recital spaces. Bloomberg is ranked 20th on Forbes’ recently released list of billionaires with a net worth of $ 59 billion. Koch, David H. Koch’s widow, is worth $ 46.4 billion and tied 27 with Charles Koch, David’s surviving brother. Leonard Lauder, president emeritus of the Estée Lauder Companies, has a net worth of $ 25.5 billion and is ranked 64th. Forbes lists New York City as the residence of the three, spokespersons for those who did not respond to request for comment. , and many others on the billionaire list. .

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“The state budget, pending the signature of Governor Andrew Cuomo, increases the state income tax for New York millionaires. ”

The state budget, which is now awaiting Governor Andrew Cuomo’s signature, is gloomy reading for the super-rich. The additional taxes will generate $ 2.8 billion next year and $ 3.3 billion next year, according to Cuomo’s office. Raises the state income tax system’s top rate to 9.65% from 8.82% for households earning approximately more than $ 1 million. People earning between $ 5 million and $ 25 million would have a rate of 10.3% and people earning more than $ 25 million would have a rate of 10.9%. New York City already evaluates a maximum rate of 3.88%. The combined city and state rate for any of the three high-income bands exceeds California‘s maximum rate of 13.3%. And don’t forget the 37% federal rate for higher-income earners making at least $ 518,400 a year, or $ 622,050 for married couples filing jointly.

In a state with 10.8 million nonresident part-time 2018 tax returns, New Yorkers making at least $ 1 million a year are a rarefied group, state figures show. In total, 122,990 taxpayers with a tax tab of $ 18.9 constituted just over 38% of the 2019 tax liability, according to estimates. Some 55,215 New York State residents earn at least $ 1 million, according to estimates by the New York State Comptroller’s Office. Their combined tax bill accounted for 31.1% of the state’s tax liability in 2019, according to the bureau’s data. • Within that, 48,243 taxpayers earn between $ 1 million and $ 5 million, paying an estimated 13.2% of the state tax liability in 2019. • Another 5,053 taxpayers earn between $ 5 million and $ 25 million and represent approximately 6 , 9% of liabilities. • At the highest end, 1,919 New York State residents earn at least $ 25 million and paid 11% of the 2019 tax liability, according to Comptroller data. Another 67,775 part-time nonresidents earning at least $ 1 million accounted for an additional 7.1% of the 2019 tax liability. The question also remains: how many people will stay to pay? After all, this comes at a time when the pandemic has made remote work much more feasible for millions of Americans. Former President Donald Trump moved his permanent residence to Palm Beach, Florida, and in 2019 said he had been “treated very badly by political leaders in both the city and state” of New York. “Few have been treated worse,” he said, adding that New York “will always have a special place in my heart!” (Florida, along with Alaska, Nevada, South Dakota, Texas, Washington, and Wyoming do not have a state income tax. New Hampshire and Tennessee do not tax earned income.) In its annual letter to shareholders Wednesday, JPMorgan Chase & Co JPM, + 0.01%. President and CEO Jamie Dimon pointed to the prospect of more taxes for the people at the top. “The wealthy must keep in mind that if tax money improves our society and our economy, those same individuals will, in fact, be among the main beneficiaries,” he wrote.