Law Offices of Connie Yi, PC - estate planning
Tell Us About Your Case

For the safety of our community, clients and staff, we have suspended all in-person meeting effective March 17, 2020. All consultation meetings will be via Phone or Zoom Video Conferencing. Please contact us at 925-484-0888 or email us directly at [email protected] to schedule the consultation.

Bay Area Estate And Tax Planning Law Firm
Estate Planning
Trust Administration and probate

Should the federal government abolish the estate tax?

| Apr 24, 2014 | Uncategorized |

Here in California and in a majority of states across the country, the state government no longer charges an estate tax to residents. Estate tax, often referred to as the “death tax” by critics, is sometimes considered a redundant tax since the assets in an estate have typically already been taxed as income or have been subject to property tax or capital gains taxes at some point.

Now, as even more states consider repealing the estate tax on the state level, many are arguing that this is time to tackle the bigger question of the federal estate tax. The federal estate tax has a lower limit of about $5.34 million, adjusted for inflation each year. That means that estates that fall under that limit will not be taxed. This may seem like a high limit but once property, retirement accounts, family heirlooms, business interests, and other assets are factored in many estate still qualify and are taxed. In states where there is a state-level estate tax taxpayers end up paying twice on the same funds in many cases.

This is just one reason why there has been a growing movement in politics to abolish the state tax on the federal level. Although it may still be many years off, it is an interesting question to pose. On one hand, it would save families money and allow them to pass along more to the other generation. On the other hand, it could decrease significant portions of tax revenue that might harm the availability of important social programs that are funding through tax revenue. 

Source: Roll Call, “Efforts to Kill Death Tax Find New Life in Blue States,” Thomas Fletcher, April 24, 2014.


FindLaw Network

Recent Blog Post

Is estate planning necessary for young people?

Misconceptions exist about the relationship between age and estate planning. Yes, older people may prioritize estate planning for reasons related to advancing age and health concerns. That does not mean only older California residents benefit from the process. Young...

What are the responsibilities of a fiduciary?

Residents of California may want to learn more about the role of the fiduciary and their responsibilities. Because fiduciary duty may be a requirement among certain professions, clients and professionals should know more about what this is. The meaning of fiduciary...

5 factors to consider when choosing a guardian

For parents, one of the biggest reasons they decide to create an estate plan is to ensure their child will be cared for no matter what. It isn’t easy to think about a tragedy where a child may lose both their parents before they turn 18, but parents have to plan for...

View More Blog Posts