Further Developments on the Estate Tax Issue
Minority Leader McConnell (R-KY) and Sen. Grassley (R-IA) Introduce Bill Including $5 Million Estate Tax Exemption With 35% Marginal Rate, Reunification of the Estate and Gift Taxes, Portability, and Opt In Provision for 2010. For your convenience, below is a synopsis of this Washington Report.
In a summary released by Sen. McConnell, the estate tax provisions of the bill (S. 3773) are described as being “comprised of the bipartisan Lincoln-Kyl estate tax reform proposal.” (See our Bulletin No. 10-75.) As such, “it provides for a 35 percent estate tax rate; a unified estate/gift exemption amount of $5 million (per individual), indexed for inflation; and a stepped-up basis for inherited assets. For the year 2010, estates can elect to retain the zero rate and carry-over basis of current law or opt into the Lincoln-Kyl structure.”
With reference to the bill’s estate tax provisions genesis in the Kyl (R-AZ)-Lincoln (D-AR) proposal, we note that many of the provisions of S. 3773 also are similar to parts of H.R. 3905 (“Estate Tax Relief Act of 2009”) which was introduced in the House of Representatives by Rep. Berkeley (D-NV) on October 21, 2009. That bill was blocked in the House Rules Committee by a vote of 7-1. (See our Bulletin No. 09-118.)