Death Tax Repeal Act of 2015

The House Committee on Ways and Means reported on a straight party-line vote H.R. 1105, 114th Cong., 1st Sess. (March 6, 2015), introduced by Rep. Kevin Brady (R-Tx) and referred to as the Death Tax Repeal Act of 2015. The bill would reduce the top gift tax rate to 35 percent, and keep the gift tax lifetime exemption at $5 million, adjusted for inflation after 2011. The bill would retain the present basis adjustments for property received from a decedent, and provide that a transfer in trust will be treated as a completed taxable gift, “unless the trust is treated as wholly owned by the donor or the donor’s spouse under [the grantor trust rules]”, except as provided by regulation. The bill seems likely to […]

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More Press on new Pressure to Repeal Estate Tax”

Josh Hoxie at the Institute for Policy Studies, has reported the following on The Hil: “Anti-tax Republicans are trotting out the old canard that the estate tax destroys family farms and small businesses. Rep.David Reichert (R-Wash.), chairman of the Subcommittee on Select Revenue Measures in the House of Representatives plans to hold a hearing Wednesday on the impact of the federal estate tax on family farms and small businesses.  The hearing is a red herring, a distraction from a substantive conversation about the concentration of wealth and the real needs of farmers and small businesses. We’ve been here before.  In the late 1980s, anti-estate tax campaigners complained that the estate tax was the “death of the family farm.”  Americans for a Fair Estate Tax, a […]

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Estate Tax Repeal Through the House Ways and Means Committee

The House Ways and Means Committee on March 25 approved seven bills dealing with oversight of the IRS and repeal of the estate tax. Democrats on the committee were in agreement on the IRS measures but balked at repealing the estate tax. The bills are expected to come up for a vote in the House after Congress returns from a two-week recess on April 13. Alluding to the current activity and deliberation among lawmakers regarding tax reform, House Ways and Means Chairman Paul Ryan, R-Wis. said the entire tax code needs to be replaced and the committee’s action with the markup is a “step in that direction.” He called the tax code “a mess,” and sharply criticized the IRS in his opening statement, saying, “The […]

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Facebook Plans a “Legacy Contact”, for Life, After Death

From IDG Connect: “Facebook recently announced plans for a “legacy contact” so social media profiles can be maintained after the death of their owners by trusted others. Here, Richard Law, CEO of identity management software developer GBGroup, answered questions on the significance of Facebook’s move. Is the Facebook move unique? Facebook’s move to allow users to appoint a ‘digital power of attorney’ may be among the first but it will surely not be the last. If anything, it represents the perennial nature of Facebook and the focus people are beginning to place on their digital afterlives. I expect other networks will soon follow Facebook’s lead as users become increasingly aware of the value of their identity and the increased need to protect it – even […]

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Facebook Adds Provisions for Access after Death

We have previously referred to “The Digital Beyond” website and its focus on transitioning our digital assets.  I have included a link to their new post, describing the Facebook acknowledgement of this issue, following Google, and others.  Its a good idea to set up some way to give digital access to your heirs of appropriate accounts. http://www.thedigitalbeyond.com/2015/02/facebook-adds-legacy-contacts-to-address-digital-afterlife-issues/

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Short Version: Obama’s Proposal to Tax Gains on Gifted and Inherited Property

In the State of the Union Address, the President proposed raising revenues by imposing capital gains on appreciation in the value of a decedent’s assets at his or her death, coupled with an increase in the capital gains tax rate to 28 percent. The proposal would treat bequests and gifts, other than those made to charities, as recognition events on which the capital gains tax would be imposed, but for married couples, no tax would be due until the death of the second spouse. Capital gains of up to $200,000 per couple ($100,000 per individual) could still be left free of tax and this exemption would be automatically portable between spouses. Couples would also have an additional $500,000 exemption for personal residences ($250,000 per individual), […]

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New Bills Introduced to Repeal Estate Taxes

Rep. Mac Thornberry (R-Tex) introduced H.R. 173, 114th Cong., 1st Sess. (Jan. 6, 2015), the “Estate Tax Repeal Act,” and Rep. Richard Hudson (R-N.C.) introduced H.R. 186, 114th Cong., 1st Sess. (Jan. 7, 2015), the “Farmers Against Crippling Taxes Act,” which would repeal the estate, gift, and GST taxes, but not the basis rules of Code Sec. 1014 and Code Sec. 1015 . H.R. 173 has 55 co-sponsors as of this writing. Both bills were referred to the House Committee on Ways and Means. These are meant to stimulate the debate about moving forward, perhaps along lines suggested in our recent posts.  Certainly, the issue is starting to get renewed attention.  It is always possible that we could be surprised, as we were two years […]

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Is the Repeal of the Federal Estate Tax Becoming More Likely?

Keeping in mind my recent post showing continued political interest in legislation to repeal the “death tax”, careful observers are starting to make an argument that would have been implausible before Obama’s recent proposal to impose capital gains taxes on inherited property. The new reasoning starts with the recognition that the estate tax now raises only about $7 Billion (estimated) per year, and affects only .2% of our population after increasing the exempt amount to $5.43 million per person.  Estimates of the cost of collecting the tax, and the loss in revenue from income taxes on (greater, non-taxed) inherited wealth have led to wild eyed estimates that ending the estate tax would result in a net profit to the government.  If we then add the […]

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Obama’s Threat to Step Up in Tax Basis, at Death

President Obama’s proposal to impose capital-gains tax on many inherited assets would curtail a valuable tax benefit known as the “step up” in basis. Here’s how the Journal explained the step-up benefit in a recent Weekend Investor cover story: The federal code has long had a provision, known as the “step up,” that cancels the long-term capital-gains tax on assets that a taxpayer holds until death. The step-up automatically raises the owner’s cost basis for such assets—the starting point for measuring a taxable gain—to its full market value as of the date of death. For example, say an investor bought a piece of land or stock shares many years ago for $20,000, and the value has grown to $200,000. If the investor sells the asset before his death, he will owe capital-gains tax on the […]

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The Classic Modern Analysis of Dying

We best not omit the very influential physician Sherwin Nuland, who wrote How We Die in 1994.  He left us last year.  The wonderful “Brainpickings” explains it better than the Will Doctor ever could. http://www.brainpickings.org/2015/01/02/sherwin-nuland-what-everybody-needs/

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