Big Estates in 2010 May Be an Incentive Against a Retroactive Estate Tax

I recently reported on the death of Dan Duncan, the 74th richest person in the world.

If Congress reinstated the death tax for 2010 and made it retroactive for the year, Dan Duncan’s estate would generate up to $4 billion for the IRS. Although this seems to be a strong incentive for Congress pass a retroactive reinstatement, The Trust Advisor Blog predicts that Duncan’s death will actually have the opposite effect.

According to probate gurus, the higher the amount of money on the table, the less likely Congress will pass a retroactive tax. Big estates are backed by big lawyers who are prepared to fight for those billions of dollars. Litigation would go on for years.

“[M]aking the tax retroactive would be a bit like Russian roulette: the longer the game goes on, the more dangerous it gets.” Scott Martin, Billionaire’s Heirs First to Win 2010 Estate Tax Jackpot, The Trust Advisor Blog, April 10, 2010.