Wednesday, March 8, 2017
Trump Vows Estate Tax Repeal, But California Plans Its Own 40% Estate Tax
Robert W. Wood (Forbes), Trump Vows Estate Tax Repeal, But California Plans Its Own 40% Estate Tax:
California doesn't like Trump, but sure does like tax increases. At around the same time as President Trump was being elected, California was increasing state income taxes again. The state's high 13.3% California tax are only temporary though, just through 2030! Of course, that was back in November. It must be time for another tax hike. The latest is a move by the Golden State to tax estates, even if the feds do not.
If the federal estate tax law is repealed by President Trump and Congress, estates in California will still pay. A bill was introduced by state Sen. Scott Wiener (D-San Francisco), asking voters to keep the estate tax after all. The proposal would have to go to voters. ...
President Elect Trump will surely dampen any such discussion and push for repeal. If it happens, there could be a fight in California over the state's reverse me-too tax move. But if the feds repeal it, and California enacts its own estate tax replacement, will all the billionaires remain, or will high California taxes spark an exodus? It isn't a silly question.
Kelly Phillips Erb (Forbes), Fix The Tax Code Friday: Estate Tax Repeal
Whenever estate tax reform is discussed, the purely political exemption of "old money" (in trusts from before 1986) from the estate tax should be mentioned (see Prof. Zelinsky at https://blog.oup.com/2009/02/grandfather-exemption/). Eliminating it is an obvious first step. Better yet, impose the estate tax retroactively on those trusts, at the rates current from 1986 to the present.
Posted by: Eric Rasmusen | Mar 8, 2017 10:41:02 AM
Quote: "President Elect Trump will surely dampen any such discussion and push for repeal."
Oh, I don't know, were I Trump, I'd be happy to see California make mistakes like this one. When does that 40% tax cut in? It's doesn't take much property in coastal California for the value to run into the millions.
This will lead to an exodus of wealthy seniors from the state. They'll sell that too-taxed estate and move where there is little on no estate tax.
Posted by: Michael W. Perry | Mar 8, 2017 11:46:34 AM