Election Day and the Estate Tax:  What If?

As election day nears, the prospect of the unraveling of Republican estate tax rules, giving generous exemptions for American families, looms darkly on the horizon. Changes made in 2017 doubled the estate tax exemption amount (to $11.58 million in 2020) so most Americans could pass their legacies to heirs without estate tax liability.

If Democrats win the White House and the U.S. Senate in November, the tax increases on the wealthy, as proposed by former Vice President Joe Biden, would impose lower exemptions and higher tax rates to cover health care commitments and battle climate change. Estates certainly are tempting targets for federal fund-raising: lowering the estate and gift tax exemption to the 2009 level of $3.5 million would raise $267 billion.

We are advising clients now to consider proactive steps.