Bloomberg Wealth discusses the dramatic decline in revenue from the U.S. estate tax. The article begins as follows:
Revenue from the U.S. estate tax has been cut in half in two years, new datafrom the Internal Revenue Service shows, even as dynastic wealth soars.
Just 1,275 wealthy families paid $9.3 billion in estate tax to the U.S. Treasury in 2020. As recently as 2018, the IRS collected more than $20 billion from nearly 5,500 families.
The dramatic decline — to the point where the tax is paid by 0.04% of dying Americans — is largely the result of the tax overhaul enacted by Republicans in 2017, which doubled the amount the wealthy can pass to heirs without triggering the levy.
Married couples can now transfer $23.4 million over their lifetimes tax-free, but families with vastly greater sums can hire sophisticated advisers to get around the tax. Nike Inc. founder Phil Knight used a variety of techniques to transfer billions of dollars to his family tax-free, according to a Bloomberg investigation last month.
The estate tax is “easy to minimize,” said Richard Greenberg, a lawyer at Greenberg & Schulman based in Woodbridge, New Jersey. “With the combination of the doubled exemption and all of the estate-planning techniques that are available, you can bleed a lot of money out of an estate and get a lot of wealth transferred.”
To see the full article, click: “Ultra-Rich Skip Estate Tax and Spark a 50% Collapse in IRS Revenue”
Posted by Anthony Tran, Associate Editor, Wealth Strategies Journal