Death Tax Reform Effort Sees Movement

Death Tax Reform Effort Sees Movement

Just when it seemed relief from the death tax was a dead letter, the U.S. Senate adopted a non-binding amendment as part of the 2008 budget bill that would provide for various tax cuts, including death tax relief.

The amendment offered by Senator Max Baucus (D-Mont.) and approved by a broad margin (97-1), provides a $3.5 million exemption, indexed to inflation, and a 45-percent rate.

As current law temporarily phases out the estate tax over ten years, ending in 2010, and then returns to pre-cut level in 2011, the Baucus language essentially freezes the death tax at 2009 levels until 2012.The House is currently debating its budget bill and it, too, provides for modest estate tax relief.

NADA says that even though the budget resolution is non-binding, the debate is encouraging since it brings death tax relief to the forefront in the new Congress. Although the Baucus amendment does not go far enough, NADA will continue its vigorous efforts for estate tax reform in this Congress.