I don’t think this is accurate. My understanding is the inheritance tax exclusion amount is a rotating thing, starting in 2002 with $1 million exclusion, and then every two years an addition $1/2 million exclusion, up to 2009 which is $3.5 million. In 2010, there will be no inheritance tax…if you die that year, lucky you…Actually, lucky are your heirs… :(. But, starting in 2011, it goes back to $1million exemption. And there is not indication if thereafter, the exemption will increase every two years or the $1million exemption stays or a higher limit is imposed.
Bush/republicans tried to make the repeal of the inheritance tax permanent i think. But that bill failed to pass in 2006 when I believe it was combined with a minimum wage bill.
So in fairness to Obama and McCain, neither of them are really a reimposing a higher estate taxes. If either of them don’t do anything, it automatically reverts to a higher taxable amount.
Now what I understand the difference between obama and mccain is is that
McCain wants to make the exclusion amount $5million and cap estate taxes at 15% thereafter
Obama wants to make the exclusion amount $3.5million
and maintain the maximum estate tax rate at 45%
In either case, it still would need to go through Congress, making this really a moot point right now.
Also, it’s really a moot points, because there are additional ways to shelter inheritance above the exclusion rates that has to do a lot with doing various types of trusts, annuities,insurance, etc..all of which is too complicated for me with a peon sized brain to explain, but very rich people’s estate attorney probably is really well versed in.
