In January and February of this year we blogged about the changes to the estate tax. We may have even used the term ”permanent” in our January post. Please forgive us. While it’s true that the estate tax laws that were passed on January 1, 2013, do not contain an expiration date or sunset provision, the changes in the law are permanent only as long as Congress and the President leave the law unchanged.
Last week the Obama administration unveiled its budget proposal, and once again the estate tax is in the crosshairs of uncertainty. President Obama’s proposed budget would decrease the estate tax exemption to $3.5 million starting in 2018 and would be indexed for inflation moving forward. Furthermore, the estate tax would be increased from today’s 40% rate to 45%.
In addition to the foregoing, there are other interesting proposals in the budget that would impact some of our estate planning techniques. Accordingly, we will be closely watching the proposed budget to see if any of the changes make their way into a legislative bill this coming year.
Attorney Jason Walker