Senate Democrat’s New Tax Proposal Could Change Paychecks for Millions

Taxes | March 6, 2026

Senate Democrat’s New Tax Proposal Could Change Paychecks for Millions

Sen. Chris Van Hollen, D-MD, has introduced a proposal that would eliminate federal income taxes for workers earning up to $46,000 and married couples earning up to $92,000, potentially exempting about half of U.S. workers from the tax.

By Chris Pugh
cleveland.com
(TNS)

WASHINGTON — A Democratic senator has introduced a plan that could remove federal income taxes for close to half of workers in the United States. The senator said the idea would help many working families keep more of their paychecks.

The proposal comes from Sen. Chris Van Hollen, a Democrat from Maryland. His plan would eliminate federal income taxes for individuals earning up to $46,000 a year. Married couples making up to $92,000 combined would also qualify. The senator said this level represents what many experts call a “living wage.”

If passed, the plan would sharply increase the number of Americans who do not pay federal income taxes. Today, about 37 million tax filers already owe no federal income tax. Under the proposal, that number could rise to around 66 million people. That would mean close to half of U.S. workers would no longer pay the tax.

Van Hollen said the goal is to help middle- and lower-income households that are struggling with higher costs for housing, food and other basics. He argues that the tax code should focus on giving relief to working people while asking wealthier Americans to pay more.

To pay for the plan, the proposal calls for a new tax on millionaires. The measure would add a surcharge on incomes above $1 million. According to early details, the surtax could raise about $1.5 trillion over the next decade to help offset the cost of the tax cuts.

Recommended Articles

The plan also includes a gradual phase-out for workers earning slightly above the income limits, allowing them to receive partial tax relief.

Analysts say the proposal faces long odds in the current Republican-controlled Congress.

“As long as Republicans control the Senate, any Democratic proposal without bipartisan support faces very long odds,” said cleveland.com | The Plain Dealer Washington D.C. reporter Sabrina Eaton. “That doesn’t make it purely symbolic. It’s also a way for Democrats to signal their priorities and give voters a sense of what the party would do if it regained power.”

Photo caption: Sen. Chris Van Hollen (via vanhollen.org)

_______

©2026 Advance Local Media LLC. Visit cleveland.com. Distributed by Tribune Content Agency LLC.

Thanks for reading CPA Practice Advisor!

Subscribe for free to get personalized daily content, newsletters, continuing education, podcasts, whitepapers and more…

Leave a Reply