Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Monday, November 6, 2017

Proposed Tax Policy By Republicans Would Enable Wealthy to Pass On A Massive Income Tax Deduction to Their Heirs Upon Death

Armageddon-2721568__340The new GOP tax plan proposes to eliminate the estate tax while maintaining the allowance for step-up in basis and the ability for taxpayers to depreciate their rental property. This proposal would allow the ultra-wealthy to transfer their assets to beneficiaries tax-free. Beneficiaries would then receive assets with a stepped-up basis and could, in the case of rental property, depreciate the property to receive an income tax deduction. Such a continued concentration of power and land in the hands of the few might lead to decreased social mobility and drive us back to a feudal system. 

See Kevin A. Pollock, Proposed Tax Policy By Republicans Would Enable Wealthy to Pass On A Massive Income Tax Deduction to Their Heirs Upon Death, Kevin A. Pollock BLAWG, November 3, 2017.

http://lawprofessors.typepad.com/trusts_estates_prof/2017/11/proposed-tax-policy-by-republicans-would-enable-wealthy-to-pass-on-a-massive-income-tax-deduction-to.html

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Comments

This simply continues the policy of the Wilson Administration in effect before enactment of the modern Federal estate tax in 1916. Assets received from an estate were stepped-up from the time of the Revenue Act of 1913. In fact, property received as a gift also got a new basis from the time of the enactment of the Revenue Act of 1913 until he Revenue Act of 1921 provided otherwise. So this isn't some new Republican plan but a continuation of the Democratic Party's policy concerning how things should work when we don't have an estate tax.

Posted by: Joseph W. Mooney | Nov 7, 2017 8:04:16 AM

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