U.S. HOUSE MAY SOON VOTE TO ELIMINATE ESTATE TAX

When the American Taxpayer Relief Act was passed in 2012, it included a provision making the federal estate tax permanent. But now, less than two years after the act's passage, the U.S. House of Representatives may be on its way to repealing the infamous estate tax.

A new bill, introduced by Republican Rep. Kevin Brady from Texas in June 2013, has garnered 221 cosponsors in the House of Representatives - nearly 51 percent of its members. In a public statement, Brady specifically argued the following:

  • That the estate tax has had negative effects on family-owned farms and businesses
  • The existing tax prevents these assets from being passed on from one generation to the next easily.
  • The estate tax effectively double-taxes income and property, since all property eligible for the estate tax is also taxed at the original time of purchase.

The U.S. Senate has created its own version of the bill, which is being cosponsored by Republican Sens. John Cornyn from Texas and John Thune from South Dakota. Opponents of the bills claim that eliminating the estate tax would cost the government billions - perhaps as much as $200 billion, according to the Tax Policy Center. Both bills are currently in the committee stage awaiting further action.

Legal tools may also help minimize or eliminate the estate tax burden on your loved ones. If you are preparing an estate plan in New Jersey, consult a lawyer for advice navigating the complex process and considering your full range of options.

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