What's the Deal with Estate Tax in 2010?
One of my blog readers sent me a questions about estate tax I thought I’d share with everyone, along with my response:
“I heard that the estate tax ended in 2009 and that there isn’t anything set for 2010,
and that it will re-appear in 2011 at a higher rate. Is this true? Regards, Pete C.”
Yes, Pete, this is true. The only thing that is up in the air is new legislation to cap estate tax at $3,500,000 before the end of 2010. That means that the existing law
would go away and going forward no one would pay estate tax until their assets reach over $3.5 million in value. Democrats don't want the old law of taxing anyone with $600,000 in assets to come back on them and receive blame about taxing “the rich.”
It is easy to amend things rather than write a whole new law, that’s why I predict the old law being amended by year-end and the new $3.5 million exemption going into affect in 2011.