Friday, April 03, 2009

Estate tax notes

The Administration has proposed freezing the federal estate tax exemption and tax rate at the 2009 levels, and the House budget bill is in accord. However, Tax Notes ($) reports that the Senate is taking a slightly different approach:
The Senate passed, 51-48, an amendment, from Senate taxwriters Blanche L. Lincoln, D-Ark., and Jon Kyl, R-Ariz., that authorizes a modification of the estate tax, setting the exemption level at $5 million and the maximum rate at 35 percent. The underlying Senate budget resolution would index the current $3.5 million exemption level to inflation and maintain the maximum estate tax rate at 45 percent.

In response to the passage of the Lincoln-Kyl amendment, Senate majority leader Dick Durbin, D-Ill., offered an amendment to condition any further cut to the estate tax on middle-income earners getting an equal tax break. The amendment passed 56 to 43.

Senate Finance Committee Chair Max Baucus, D-Mont., who has introduced a bill that would extend the estate tax at its 2009 level, voted for the amendment.

1 comment:

JLM said...

Raise the federal estate tax exemption? Lower the tax rate? Gee, I bet The New York Times loved those ideas.

Well, not exactly. See yesterday's editorial, The Forgotten Rich. And check out the extensive comments, mostly partisan, a few interesting.

I liked the one that said failure to ease the death tax would merely promote trusts – namely, QPRTs.