The 2017 Congressional session could bring big changes to the federal estate tax laws on the books.
Under present laws, estates with values of $5.45 million or less carry no estate taxes. Those of more value, however, get taxed at 40 percent, according to the 2013 bipartisan compromise that avoided the fiscal cliff dive. GOP aides speculate that fully repealing the federal estate tax carries a $200 billion price tag spread out over a decade.
Among the GOP leaders spearheading the efforts to repeal estate taxes is Sen. John Thune of South Dakota. He and his colleagues also plan to block any attempts at forcing a final vote before year’s end to block the proposal from the Treasury Department rule to toughen levies on inheritances.
Thune is a member of the Finance Committee with seniority who is confident of a consensus support for his proposed repeal of the estate tax. This is just one part of the broader tax overhaul GOP members are angling for in the 115th Congressional session next year.
“If we can get into a debate about comprehensive tax reform, the odds are good that we can repeal the estate tax,” Thune said recently.
Both the “Better Way” agenda of the House GOP and President-elect Trump dovetail regarding repealing the estate tax laws.
Republicans tout repealing the estate tax as a boon to small business owners and another way to save American jobs. Liberal opposition comes from Democrats like Rep. Keith Ellison of Minnesota, who argues that fully repealing the law is a windfall to the uber-wealthy, namely, Trump’s own family and proposed Cabinet members with lots of zeroes in their net worth.
If you are the owner of a family-owned business, you would be wise to keep a close eye on the upcoming developments in Congress next year. Those with specific questions about how the proposed changes could affect their estate planning efforts should seek legal advice.
Source: Roll Call, “Estate Tax Repeal to Get Big Push in New Congress,” Alan K. Ota, Dec. 12, 2016