Posted by: Heinz Brisske
It has become a bit easier to predict changes in the federal estate tax since Congress removed the “sunset” provision from the law in early 2013 (retroactive to January 1, 2013). We can now claim to have a “permanent” federal estate tax law. We all know what that means: it’s permanent until Congress decides to change it yet again. Over the past several decades, there have been major federal estate tax changes at least every couple of years, either in the amount taxed, the tax rate, or both, and regarding other issues such as portability of the estate tax exemption to a surviving spouse. In other words, the federal estate tax has been, and will probably continue to be, a political football, and we won’t know which way it will bounce from time to time.
So, where do we go from here? Frankly, no one knows; but for a short summary of where we are and where some politicians want us to be, you can read this Forbes article.
A better question might be “where do you think we ought to be” in the estate tax debate. Are there fiscal reasons to bring the tax threshold down from its current lofty heights, higher than ever before in our history? Are there social engineering reasons to increase the tax on the wealthy (i.e., is the gap between the “haves” and the “have-nots” truly widening and threatening our social fiber)? Should the federal estate tax be scrapped, repealed, done away with? If so, how would that affect the economy of this country? What about the state of Illinois and its estate tax, which kicks in at $4 million?
The issues aren’t simple and straightforward, and regardless of your political affiliation, this isn’t an issue that should be politicized. Unfortunately, this is the world we live in, and politics will continue to affect, and in some cases control, what happens to this, along with many other, important issues.