California Estate Planning Blog by Kevin Staker

July 29, 2010

Appears Likely Exemption Now Narrowed Down to $1,000,000 or $3,500,000

Filed under: estate tax,Kevin Staker,Other Kevin Staker Blogs — Kevin Staker @ 5:06 pm
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The Wall Street Journal and a number of other media outlets report Majority Leader Reid is not allowing the Kyl-Lincoln amendment to the Small Business bill.  He apparently opposes the amendment on its merits, a transition to a $5,000,000 exemption and only a 35 percent estate tax rate.

Hence, it now pretty clear that he is going to allow at most a $3,500,000 exemption with at least a 45 percent top rate.  The question then is is Mr. Reid going to stymie any attempt to change the post 2010 estate tax law and allow the $1,000,000 exemption and 55 percent top marginal rate to go into effect in 2011.

By Kevin Staker


July 23, 2010

Baucus Looks to September for Estate Tax Changes

Filed under: Uncategorized — Kevin Staker @ 2:09 pm
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Dow Jones Newswires in a story by Martin Vaughan states that Senate Finance Committee Chair Baucus met with the members of his committee Thursday evening and they discussed among other issues, what to do about the estate tax.  The story lays out the following (sorry, the author is on vacation and does not have enough time to put this in his own words):

Baucus held a meeting with Republicans and Democrats on his committee Thursday evening to begin discussing how to deal with the approaching expiration of the tax cuts.

Baucus raised the possibility of a September committee vote, people present said. Aides cautioned that no conclusions about what to do or when to do it were reached at the meeting.

“This was more exploratory, figuring out what is the best policy for our country,” Baucus told reporters after the meeting.

One option discussed during the meeting was wrapping several tax bills that have up until now been distinct into one piece of legislation for committee mark-up, the people said. That could include extensions of the Bush tax cuts, including the estate tax, a provision to shield most people from the alternative minimum tax, and extensions of tax breaks for businesses that bogged down in the Senate last month.

The article is located at

By Kevin Staker

July 22, 2010

Senate Vote to Repeal Estate Tax Fails, 39-59

Filed under: estate tax,Kevin Staker — Kevin Staker @ 5:22 pm
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Republican Senator Jim DeMint made an interesting (finally) and instructive attempt to repeal the estate tax. He introduced the proposal as an amendment to H.R. 4213, the bill to extend unemployment benefits. Majority Leader Reid finally put together the votes to get the benefits extended. (One personal comment: Let me get this straight, we are going to borrow money from the Chinese and other foreign investors so some people can get more money now but that our grandchildren must pay back later?)

Hence, I believe one thing is clear. The estate tax is coming back. This was a perfect opportunity for the Senate to repeal the estate tax and they did not. The only question now is what is the exemption and what are the rates going to be?

This author cannot easily find out who voted how but suspects was the same as on the Small Business bill the Senate is also considering. Such a vote would be all Republicans voting in favor of repeal, except for the two senators from Maine, Collins and Snowe, with one Democrat voting in favor, likely Lincoln or Nelson.

By Kevin Staker

July 10, 2010

Excellent Wall Street Journal Article on the Estate Tax Incentive to Die This Year

Filed under: estate tax,Kevin Staker — Kevin Staker @ 12:53 pm
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The Wall Street Journal has an excellent article by Laura Saunders and Mary Pilon entitled, “Too  Rich to Live.”  The article shares this author’s concern that the transition at midnight on January 1st from no estate tax to an estate tax with only a $1,000,000 exemption gives the incentive to rich folk to commit suicide.  It also shares my opinion that it is presently impossible to predict what, if anything, Congress and the President are doing to do about the estate tax.

They share my view that Congress has relatively few working days left in the year (only 40) because of the mid-term election, they have more pressing issues to address, and they are unlikely to address such a volatile topic so close to an election.  Hence, if they do anything it is now appearing it will be after the November election during the lame duck session.

The article can be found at /SB10001424052748703609004575355572928371574.html

By Kevin Staker

July 1, 2010

Latest Word: No Estate Tax Fix Until After November Elections

Filed under: estate tax,Kevin Staker — Kevin Staker @ 9:56 pm
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Just as this author has feared and has been warning, it is beginning to appear that Congress will not address the estate tax law until after the November election.  The Hill, of course the Hill, in an article by Alexander Bolton reports that the “Democrats will punt on taxes.”  They report some Democrats want to wait to address the issue of all taxes until after the Debt Commission issues its report in early December.  However, if past is prologue, that would mean they would not have time to do anything before the session of Congress ends, just like the end of 2009.  (Which gave us the mess we are in with no estate tax and a limited step up in basis.)

Other Democrats want us to get back to a $1,000,000 estate tax exemption (Sen. Harkin).

Senate Finance Chair Baucus says he will address the Bush tax cuts until the Senate deals with the “extenders”.    He means the bill that would extend into 2010 certain tax provisions that expired at the end of 2009 (the itemized deduction for sales taxes, the additional standard deduction for real property taxes, and deductions for tuition and teacher expenses).

This not good.  The extenders had been lumped in with the extension of unemployment benefits, a political football, not likely to pass.

On the other hand, the Hill reports Senator Bingaman, a Democrat member of Senate Finance, wants to get the Bush tax cuts addressed before the August recess.  So there is some glimmer of hope they may include the estate tax in such legislation.  However, it has not even been introduced (to my knowledge).

On the other hand, some Republicans are stating they believe the issue will not be addressed until the lame duck session.

Senate Majority Leader Reid commented about dealing with the Bush tax cuts and by implication the estate tax:

“Maybe if they (the Republicans) stop stalling everything that comes to the floor we might be able to get to that stuff. We’ll get to that when we get through unemployment insurance, Wall Street reform, and a few other things.”

Chaos continues.

The article is at

By Kevin Staker