Sponsors
The bill raises revenue and simplifies Social Security funding by tightening estate tax rules and consolidating trust funds, trading higher taxes and planning burdens for many estates and potential risks to targeted disability protections in exchange for clearer financing and reporting.
Very-high-net-worth estate owners: The bill lowers estate tax exclusions and raises rates for very large estates, increasing federal revenue and reducing potential wealth concentration.
All Social Security beneficiaries and administrators: The bill consolidates OASI and DI into a single Trust Fund and directs annual appropriations equal to payroll-tax receipts, clarifying post-2027 funding flows and reducing uncertainty about financing.
Seniors, disabled people, survivors, and the public: Trustees must provide separate actuarial analyses for disabled, retired, and survivor beneficiaries, improving transparency about cost drivers for each group and making administrative reporting clearer.
Estate owners with assets roughly between $3.5M and $15M (and their heirs): Many families and small-business owners who previously owed no federal estate tax will now face new tax liabilities, increasing outlays at death.
People with disabilities and disability beneficiaries: Pooling OASI and DI balances could obscure separate shortfalls and make it politically easier to draw down funds intended for disability benefits to cover retirement shortfalls, risking deprioritization of DI.
Middle-income heirs and family businesses: Lower exclusions and higher estate taxes reduce inheritances and may harm heirs who depend on family transfers for housing, business continuity, or starting capital.
Based on analysis of 3 sections of legislative text.
Cuts estate/gift tax exclusion to $3.5M and limits spousal unused exclusion; merges Social Security trust funds and directs payroll-tax receipts to the new single trust fund starting 2027.
Introduced March 25, 2026 by Christopher Van Hollen · Last progress March 25, 2026
Lowers the federal estate and gift tax protections to roughly 2009 levels by cutting the basic exclusion to $3.5 million (indexed changes removed) and tightening spousal unused exclusion rules, and changes the estate tax rate table. Separately, it consolidates the two Social Security trust funds into a single “Social Security Trust Fund,” transfers existing balances into that fund, and directs the equivalent of 100% of Social Security payroll taxes to be appropriated to the new combined trust fund starting in fiscal years after January 1, 2027. The estate/gift tax changes apply to decedents dying and gifts made after December 31, 2026.