Many business owners and aging Americans are on edge, just waiting to see what will happen to the structure of estate planning under the Trump's administration. After all, talks of repealing the death tax could drastically change how some plan for the future of their successors.
What does it all really mean, though? How, exactly, could the potential repeal change how you and your family plan for the next generation. More importantly, should you make those changes just yet? The following explores these concepts and the possibility of what could be to come under a Trump presidency.
What the Estate Tax Repeal Might Mean for You
If you own a family business, family farm, or other type of high-asset, lower liquid income business that will be passed down to a successor, the estate tax plan repeal could be your family’s saving grace. Numerous families in similar situations have had to sell off critical assets to cover the death tax under the Obama administration. However, with the estate tax repeal, families would no longer be forced to deal with such difficulties. Other high-income estate planning individuals (particularly the more wealthy of Americans who are currently subject to the death tax) are likely to benefit greatly from the repeal as well. Of course, there are still some important and key details to remember when it comes to effective estate planning.
First, it is key to recognize that passing a complete repeal may not come easily. The Bush administration attempted the same feat, but failed. With the requirement to pass through with 60 votes but only 52 GOP senators, this could derail Trumps efforts as well. Further, even if the repeal passes, it could take a few years for things to be fully implemented; some experts estimate anywhere from two to three years, possibly even longer. There are also some crucial details of Trump’s tax plan that have not yet been fully fleshed out. Continued resistance and concern over whether certain elements may lead to a bigger deficit could be problematic as well.
Advice for Those Planning an Update to Their Estate Plan
If you are one of the many who are waiting and hoping for the estate tax repeal, it is best to sit back and wait – at least for now. After all, no one can truly predict the future. This does not mean you should not prepare for the future, however. Discussing what your future options may be with your estate planning attorney can help to ensure you have a viable plan in place if, and when, the repeal does happen.
At Drost, Gilbert, Andrew & Apicella, LLC, we understand the need to protect your family’s future, and the future success of your business. Dedicated and experienced, our Barrington estate planning attorneys can help develop an estate plan that is designed to protect your interests. To learn more, call 847-934-6000 and schedule your personalized consultation today.
About the Author: Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/ commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.