2010: The Year to Die?
By Dian Vujovich
Oh those estate tax laws. If there must be a tax on our estates, why there isn’t something simple in place, like an exemption amount that gets adjusted upwards as the times change and carries with it a stable fixed tax rate, is beyond me. But that would mean using common sense and from what I can tell, that’s in short supply in Congress.
As it stands today, given that there have been no changes made to President George W’s tax laws put in place in 2001, next year, 2010, is the year to die for those with hefty estates because it’s the year of no-estate taxes. That means, if you’ve an estate valued at $3.5 million or more when you die, die next year and your heirs will have no estate tax to pay. None. Zilch. Nada cent.
While that could be bully for you, the tax-sensitive one who dies (and their heirs), it’s not for Uncle Sam who it’s estimated will lose something like $18-25 billion in tax revenues. And in these times of huge deficits, this what’s-good-for-a-couple-gooses isn’t so hot for a gaggle of ganders given our current debt load.
I’m not sure what our previous president was thinking when he made 2010 a freebie when it came to estate taxes and the year following, 2011, a real corker: Beginning on Jan.1, 2011, the estate tax jumps to 55 percent on amounts over $1 million. But whatever it was, it was a goofy move.
That said, all of this could change if Congress decides to take some action. Guesses from reliable sources say that they expect Congress to tackle the estate tax concerns early next year at the latest and make whatever new notions they come up with retroactive to January 1, 2010.
But if no changes are made, any heirs of the roughly one-half of one percent of the public with estates valued at over $3.5 million who lose their benefactor next year would have something to smile about through all their grieving tears.
To read more articles, please visit the column archive.