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 pass the House of Representatives.

As noted previously, the Will Doctor believes that this represents an interesting opportunity for a compromise to repeal estate and gift taxes in favor of the assessment of income taxes on capital gains inherent in gifted and inherited property.  As noted below, the Senate is also considering this issue.

On March 25, 2015, the Death Tax Repeal Act of 2015, S. 860, 114th Cong., 1st Sess. (March 25, 2015), was introduced in the Senate by Sen. John Thune (R-S.D.). This is identical to the similarly-named bill which was reported favorably by the House Committee on Ways and Means on that same date.

Posted in Status of Tax Legislation, WillPlan Blog.

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