No Capital Gains Allowance for American Adversaries Act

This bill changes how U.S. taxes work for money made from investments tied to certain foreign countries. If you sell or trade investments linked to China (including Hong Kong and Macao, excluding Taiwan), Russia, Belarus, Iran, or North Korea, any profit would be taxed as regular income, not at lower capital gains rates. Dividends from companies tied to those countries would also lose the lower “qualified dividend” tax rate. And when someone dies, these assets would not get the usual “step-up” in value for tax purposes. In short, these earnings would be taxed more like wages than like typical long-term investments .

“Specified” assets include stocks or other securities of companies that are based in, mostly operate in, or are controlled by these countries, as well as property located or used there. The SEC and Treasury would set criteria, require sellers to notify buyers about the tax treatment, and publish a public list of the affected securities. The changes would apply to sales and dividends on or after January 1, 2026 .

• Who is affected: U.S. taxpayers with investments or property tied to the listed countries
• What changes: Gains taxed as ordinary income; dividends lose lower tax rate; no step-up in basis at death; SEC notice and public list required
• When it starts: Applies to sales and dividends on or after January 1, 2026