The probability of these provisions becoming the law of the land is uncertain, at this point, and perhaps unlikely. “Permanent” in estate tax lingo is, apparently, a transitory term. Since the new law does not have a built in expiration, we have called it permanent, and the structure of the transfer tax regime appears settled-but see below!
These provisions are significant:
- A return to the estate tax exemptions of 2009 ($3.5 million at death, with a limit of $1 million during life)
- Exemptions would NOT be indexed for inflation
- Estate and Gift Tax rates going from 40% to 45%
- Limit on the GST Exemption to 90 years
- Limit on GRAT terms to no less than ten years
- Limits on retirement plans to $3 million
- Mandated 5 year distribution for non spousal retirement plan beneficiaries