Congress is considering a one-year extension of the current estate tax provisions in order to prevent the current law’s doomsday scenario of complete repeal for calendar-year 2010. Under current law, $3.5 million is exempt from every individual’s estate, and the excess is taxed at 45%. When Barack Obama was running for president last year, his platform proposed to make the 2009 law permanent. A one-year extension could create an interesting (and sneaky) policital option — leaving the rest of the current law in place, and allowing the estate tax to revert to a $1.0 million exemption and a 55% tax rate starting in 2011. This is what would happen if Congress passed a one-year patch for 2010 and then did exactly nothing further. Wall Street Journal [$].
Tags: Estate Planning, Estate Tax
