Multiple sources report the White House and House Republicans have traded proposals on avoiding the “Fiscal Cliff”. (See http://www.cbsnews.com/8301-250_162-57558603/wh-boehner-trade-new-fiscal-cliff-proposals/ and http://www.huffingtonpost.com/huff-wires/20121211/us-fiscal-cliff/?utm_hp_ref=politics&ir=politics). The President countered on Monday and the Republicans countered back today (Tuesday). They are wisely keeping their proposals private. However, they do continue to posture in public.
The odds are very high that the estate tax and related tax provisions are addressed in their proposals. Republicans wanting to keep exemptions at preset levels, $5.12 million adjusted for inflation with 45 percent top rate. The President proposing we go back to the 2009 levels, $3.5 million with 45 percent top rate for the estate tax and generation-skipping transfer tax, but only a $1 million gift tax exemption. However, the Republicans want this more than the President and so may win out on this issue in the final settlement.
Finally, the estate tax issue is getting some attention during this debate. Time magazine has an article by Christopher Matthews on the estate tax issues at http://business.time.com/2012/12/11/can-the-estate-tax-solve-the-fiscal-cliff/
This article and a number of other articles talk about a letter Warren Buffett and a number of other wealthy individuals released today encouraging the Federal government to have a “strong” estate tax. They propose only a $2 million estate tax exemption, even more liberal than the position of President Obama. However, doubtful any of the players in this negotiation will pay them any attention.
On the negotiations between Speaker Boehner and the President, we shall see.
Estate Tax News Blog