ConnorEl
Well-known member
Is the idea for the new plan to be for 2017?
Can you help me understand that point? I assume Alabama residents aren’t literally sending money to California residents. I understand that higher state tax rate means bigger deductions so you can essentially charge higher tax rates than the residents will feel. However, as the conservative Tax Foundation annually reports, the states that benefit the most from the state tax deductions still pay more to the federal government than they get back in federal spending. So in the end, even with the state tax deductions California and other rich states are still subsidizing poorer states by paying more in federal tax dollars than they get back.
I would assume so. They have to realize that they may lose control of Congress in November, so I think they'll try to push it through Obamacare style.
Eh, I think it probably is. Because of the timing requirements, you get people who have like a $500k businesses having to spend the planning resources now in case they hit the $5mm threshold in the future. If you wait until you hit the $5mm then it is usually way too late. So the structure captures a lot more people than the actual tax.
Because you have to actually do them, not just read about them. Using that article as an example, #1 is fine but is obviously very limited in effect. #3 is just giving shit away to unrelated entitites, so is kind of stupid to include. #2, #4 (these aren't even really used any more), and #5 are part of what the industries I mentioned above actually do. A regular person isn't going to be able to write a compliant ILIT, and handle the annual compliance requirements. Tech has done an awful job trying to take over those components; usually the products from things like Legal Zoom and similar are absolutely horrible and make things worse than would have been without them, and the person doesn't know what they are supposed to do on an annual basis. But you never find out and can't fix them because when the time comes to utilize them you're dead, so the whole process was a waste and the heirs end up spending twice as much to try to unravel and fix it.
Last nerdy T&E lawyer comment. I'm not sure how much horse trading there will be on the specifics of the proposal, but I can see the estate tax as an easy trade for something on the corporate side. The GOP loves campaigning on repealing the "death tax," but it's a rounding error in the federal budget and it just doesn't impact very many people.
BUT THE FARMERS!
Actually I was cracking up listening to some Trump death tax jargon about how it helps the poor, common man. There's a farm here in the DC area they had a representative for to support the tax break... And if you play much golf in the area you know River Road well. You hit some of the most expensive subdivisions prior to Congressional Country Club. Around the corner is TPC Potomac, Burning Tree and also Bethesda Country Club a quarter mile in the other direction. Before you're even with Trump National across the river, some of the most insanely expensive mansions pop up prior to hitting a few "family farms crushed by the estate tax." That's where the farm is, the kind of 100+ year old family passing acres of priceless land down to already wealthy offspring... Well over the $11M limit, think of all the membership dues a tax cut would get them.
What happened to Ivanka's daycare deduction? That was like the one big win for the 1% that's not in the 0.1% group.
People don't really use ILITs and FLPs any more? We clearly have very different practices.
A couple points of agreement so it doesn't look like I'm trying to pick a fight (I'm really not). Legal Zoom and the like are horrible for estate planning; whether taxes are an issue or not. Repealing the AMT is a good thing.
Last nerdy T&E lawyer comment. I'm not sure how much horse trading there will be on the specifics of the proposal, but I can see the estate tax as an easy trade for something on the corporate side. The GOP loves campaigning on repealing the "death tax," but it's a rounding error in the federal budget and it just doesn't impact very many people.