Authored by Mark Lobb
A
revised 1,684 pages of the Build Back Better Act (the “Act”) was released on
October 28, 2021. This revised text was referenced by President Biden as
the “Framework.” The prior proposed
changes in the Act which would have substantially
altered traditional estate planning with
grantor trusts and other items have been
eliminated. Changes included in the earlier
version of the Act but not included in this recent version
include:
- Lowering the
estate tax exemption from $11.7MM to $6,020MM,
- Inclusion of
grantor trust assets in the grantor’s estate,
- Tax
realization event for sales to and from the grantor and a grantor trust;
and,
- Elimination
of valuation discounts for transfers of nonbusiness assets.
There remains the following:
- A
surtax on high-income earners,
- Expansion
of the 3.8 percent net investment income tax; and,
- Funding
for greater IRS enforcement targeting wealthy taxpayers.
Obviously, the fun and game are not over and I am sure the
Virginia election result will stir the pot, but this is where we currently
stand in regards to estate planning.
The negotiations are fluid and more
changes are likely to be incorporated into the Act.
