Proposed Changes to Estate Tax
The Biden Administration also proposed to increase gift, estate and GST tax rates from 40% to 45%. If that is not enough, they proposed to eliminate the “step-up” in bases for inherited assets exceeding $100,000 (excluding surviving spouses and charities).
The lifetime gift pendulum has swung from $600,000 per individual in 1997 to $11,700,000 in 2021 and the amount has changed every year. At a minimum, if no changes are made to the current laws, the exemption will decrease to $5,000,000 in 2026.
An even bigger concern is that these drastic proposed changes may apply retroactively, similar to what occurred with the Bill Clinton Omnibus Budget Reconciliation Act of 1993, which was signed into law in August of 1993 but applied provisions such as an increase gift and estate tax rate retroactively to January 1, 1993.
Given the current circumstances, now is the time to contact our office to discuss possible effects of the proposed tax changes on your estate and options for succession planning.
The legal information in this blog entry is not intended to be a substitute for seeking personalized legal advice from an attorney licensed to practice in your jurisdiction. Further, nothing contained in this article is intended to create an attorney-client relationship with any reader. This article and website are made available by Waldron & Schneider for educational purposes only and to give basic information and a general understanding of the law, not to provide specific legal advice. By using this website you understand that there is no attorney client relationship between you and Waldron & Schneider. The article and website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. For more information or questions you can contact us and one of our attorneys will be in touch soon.
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