Obama's federal estate tax plan

Copied and Posted by Rie Umano

Now that the presidential election is settled, there's no doubt that president-elect Obama and Congress will be addressing the fate of the federal estate tax very soon. Why? Because next year the federal estate tax exemption will increase from $2,000,000 to $3,500,000 and in 2010 the federal estate tax will completely vanish. Then, in 2011, the federal estate tax will return but the exemption will only be $1,000,000.

During his campaign, then Senator Obama was against full repeal of the federal estate tax in 2010 and instead favored making the $3,500,000 exemption permanent. But couple the fact that then Senator Obama's estate tax plan was put together well before the current economic crisis with the Democrats view that repeal of the federal estate tax would only benefit the super wealthy and take needed funds out of the federal budget, and I have to wonder if we're only a year or two away from the estate tax exemption reverting back to $1,000,000. And what about portability of the federal estate tax exemption between spouses? Forget about it, at least for now.

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