Will Tax Reform Impact Estate Taxes?
Cincinnati estate planning lawyers provide help with protecting assets and with leaving a legacy. One of the key things that an estate plan lawyer does is to help those who are providing gifts to heirs or beneficiaries to ensure that the maximum value of assets can be transferred to new owners. Unfortunately, there are many different things that could reduce the amount of assets to be transferred – from the risk of loss during life due to creditors or high nursing home bills to the potential that an estate will be hit with a big estate tax bill after a death.
Estate tax can result in many estates having to pay substantial sums of money, reducing the amount of wealth that can be passed on. While you can typically leave as much money and property as you want to a spouse without any estate tax being due, leaving money to anyone other than your husband or wife – including to your children – could result in estate tax being charged if your estate is large enough. Zimmer Law Firm has assisted many clients in finding ways to pass assets on while minimizing or avoiding estate tax.
Many people criticize the collection of estate tax for a number of different reasons. Estate taxes can cause families to lose businesses, farms or other valuable legacy assets if much of the estate’s money is tied up in business equipment or valuable farmland. The estate may not have enough liquid assets to pay the tax, which means either selling off some of the estate property or potentially taking out a loan which would have to be paid back, with interest. There is also criticism of the estate tax because people who earn and acquire assets to pass on to the next generation already pay taxes on wealth and on purchases during their lifetimes. This mean estate tax may be collected on assets that were already taxed.
While there are plenty of reasons to find problems with the estate tax, the issue could soon be eliminated. President Trump has a tax plan that he has put forward with repeals both the estate tax and AMT, or alternative minimum tax. While making an estate plan will still be important for other reasons, you may no longer have to be concerned about losing a big portion of your assets to the federal government. Zimmer Law Firm can help you to understand how the law evolves on estate tax and can work with you to ensure that you make smart choices to protect assets at the end of your life or after you have passed on.
Will President Trump Eliminate Estate Tax?
The Hill reported on President Trump’s proposed tax plan, which includes tax relief for people in the middle class as well as a repeal of the estate tax.
There is strong support for tax reform among Republicans, while many democrats have spoken out against the proposals which were included in President Trump’s plan. It is unclear whether tax reform legislation will be able to pass through congress during the upcoming legislative session. However, this is not the first effort to repeal or modify the estate tax so if reforms pass, it is likely that some change will be made to how estates are taxed. This change could include full repeal of the estate tax, as President Trump has proposed, or it could include raising the exemption so a smaller amount of estates are taxed by the federal government.
It is possible that tax reform could be passed without votes from democrats in congress if the Republicans use a process called reconciliation, which is a process by which legislation can pass the senate if it can get at least 51 votes. If reconciliation is not used, the democrats could filibuster tax reform proposals and 60 votes would be required for the legislation to move forward.
Getting Help from Cincinnati Estate Planning Lawyers
Cincinnati estate planning lawyers at Zimmer Law Firm will help you to ensure you understand any changes to estate planning laws that could impact your inheritance or that could impact the amount of wealth that you are able to leave to others. To find out more about the ways in which our firm can help you to make your plans to protect the maximum value of your wealth under the current legal system, join us for a free seminar. You can also give us a call at 513.721.1513 at any time in order to get personalized advice about your estate plan.