Last year I took an informal stab at sampling the fall and rise of the federal estate tax exemption. Now, in The Federal Estate Tax: History, Law, and Economics, the Treasury's David Joulfaian offers an accurate, detailed look at the ever-changing definition of "taxable wealth." (Click on the thumbnail for a readable view of the table.)Measured in constant, 2008 dollars, the federal estate tax exemption started at around $1 million in 1916, rising to over $1.4 million by 1931. Then began the great downward slide:
- 1932: under $1 million
- 1951: under $500,000
- 1966: under $400,000
- 1973: under $300,000
- 1977: under $230,000. No wonder President Carter detected a national "malaise."
This year the de facto exemption has reached what some consider its ideal level: unlimited. As Buzz Lightyear might put it, the exemption has soared … to infinity and beyond!
With financial reforms, environmental issues and immigration crowding the Congressional calendar, will the infinite exemption survive through New Year's Eve?
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3 comments:
Almost certainly yes, there will be no estate tax this year. Democrats are unwilling to compromise, believing that they have the stronger position in this game of chicken. Republicans expect to have many more seats next year, and so then will be able to target the estate tax more narrowly.
I read your post and it's really helpful. I now know the best things to do in order to arrive at the best estate tax exemption. Thanks!
I read your post and it's really helpful. I now know the best things to do in order to arrive at the best estate tax exemption. Thanks!
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