Yesterday, April 10, President Obama released a 2014 budget proposal in which he seeks to overhaul the estate tax, yet again.
According to Bloomberg Businessweek:
Obama’s budget would drop the per-person exemption from estate taxes to $3.5 million from $5.25 million this year and increase the top estate tax rate to 45 percent from 40 percent. The $3.5 million exemption wouldn’t be indexed for inflation.
‘It gives us new meaning to the word permanent,’ [Holland & Hart’s Scott] Sloan said. ‘Apparently permanent means five years.’
The proposal to restore the estate tax to 2009 levels may re-ignite discussions among wealthy families and advisers that occurred last year when the threshold was set to drop to $1 million, said Jay Messing. He’s a senior director of planning in the Northeast for the private bank unit of San Francisco-based Wells Fargo & Co. (WFC).
Even more controversial, Obama wants to cap IRA’s at $3.4 million and prohibit heirs of IRAs from stretching their distributions over their life expectancies.
See the entire article here.