The candidates’ standings in the polls go up and down. But how would each of them affect our clients and estate planning? Last week, we looked at Hillary Clinton’s tax plan. This week, we look at Donald Trump’s tax plan.
First, estate taxes. Donald Trump would completely up-end the current transfer tax system:
- He would eliminate the estate tax entirely.
- He would eliminate the gift tax entirely.
- Presumably, he would eliminate the GST tax entirely.
- He would disallow a step-up in basis for the assets of decedents with estates over $10 million.
Next, income taxes. Donald Trump’s tax proposals are not entirely clear and change. However, he has proposed the following:
- Cap deductions at $100,000 for individuals and $200,000 for a married couple filing jointly.
- Increase the standard deduction to $15,000 for individuals and $30,000 for married filing jointly.
- Reduce the federal tax brackets from 7 to 3, with rates of 12%, 25%, and 33%.
Current estimates are that Trump’s tax plan would:
- Reduce taxes for low income earners by an average of 1.2%.
- Reduce taxes for highest income earners by 10.2%.
According to a piece in Fortune, Trump’s plan would add $5.3 trillion to the federal deficit over 10 years.
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (800) 846-1555
www.aaepa.com
- The Magic of Grantor Trusts - September 19, 2023
- IRS Confirms Grantor Trust Status Alone Does Not Cause a Step-Up in Basis - August 15, 2023
- Double Your Gifting with Spousal Gift-Splitting - January 11, 2022
