Ivins Philips Barker has made available for download their article, “House Ways & Means Committee Takes Aim at Exemption Amounts, Valuation Discounts & Grantor Trusts”, which discusses important updates from the House Ways & Means Committee. The abstract is as follows:
The following are the most important proposals affecting high-net-worth individuals:
For decedents dying and gifts made after 12/31/21, the estate and gift tax exemption drops from $11.7 million to slightly more than $6 million.
Tax on capital gains and qualified dividends increases from 20% to 25%, effective for gains and dividends received or accrued after September 13, 2021 (with a binding contract exception).
For grantor trusts created after date of enactment (and for trust property transferred to pre-effective date grantor trusts) , the value of the assets will be included in the grantor’s gross estate, and distributions from the trust will be taxable gifts.
Any sale or exchange between a grantor and a grantor trust (other than a fully revocable trust) will be a taxable transaction. This provision applies to grantor trusts created after the effective date and portions of pre-effective date trusts attributable to contributions made after enactment.
No discounts for lack of marketability or lack of control are permitted for nonbusiness assets sold or gifted after date of enactment.
To see the full article, click: “House Ways & Means Committee Takes Aim at Exemption Amounts, Valuation Discounts & Grantor Trusts”
Posted by Marin Larkin, Associate Editor, Wealth Strategies Journal.