President Obama announced a proposed bipartisan tax deal to extend the Bush-era individual income tax cuts for all taxpayers in 2011 & 2012 and extend federal unemployment benefits for 13 more months until the end of 2011.
According to the Wall Street Journal, the deal will also cut the estate tax rate from 55% to 35% for a decedent's who die in 2011 & 2012 with assets in excess of $5 million, maintain capital gains rates at their current levels in 2011 & 2012, cut payroll taxes from 6.2% to 4.2% in 2011, and extend the child tax credit of $1,000 for 2011 & 2012 which otherwise would have dropped to $500.
Because the the proposed deal significantly reduces the estate tax in 2011, the retroactive return of the estate tax in 2010 seems all the more unlikely.
This brief overview of some important considerations associated with the Obama-Bush tax cuts is by no means comprehensive. The proposed legislation has not been passed and is not law. Always seek the advice of a competent when making important estate planning decisions.
