Estate Tax a Moving Target-Stay Prepared

October 24, 2011 Bloggies by Lou Silverman Edit

As many readers know, the current estate tax exemption is $5,000,000.00 (5M). This means that a single individual would not pay an estate tax on the first 5m of his estate, and a married couple, with proper planning, on 10M. The size of these exemptions, in my opinion, gives one the false sense of security that estate planning is not necessary. This assumption is, in my opinion, incorrect. First, the current law expires at the end of 2012, and no one can predict what Congress might do then. Second, estate planning is necessary for a myriad of reasons other than tax. I have covered many of these reasons in other articles in the blog section of my website. However, even if one were to focus solely on tax, and assume that the current estate tax laws are “stable”, here is a brief summation of the many laws passed by Congress affecting taxes, including the estate tax. This is a moving target and one should always plan for the worst, hope for the best, and be prepared with an effective estate plan at all times.

YEAR TAX LAW ACRONYM DURATION

1913 The 16th Amendment 26 Years

1939 Internal revenue Code is created 15 Years

1954 IRS Code revised (1st revision) 20 Years

1974 Employee Retirement Income Sec. Act ERISA 2 Years

1976 Tax Reform Act of 1976 TRA-76 5 Years

1981 Economic Recovery Act of 1981 ERA 1 Year

1982 Tax Equity & Fiscal Responsibility Act TEFRA 6 Months

1982 Technical Corrections Act TCA 2 Years

1984 Tax Reform Act of 1984 TRA-84 1 Year

1986 Omnibus Budget Reconciliation Act OBRA 2 Years

1988 Technical and Misc. Revenue Act TAMRA 1 Year