Biden Administration’s Green Book Proposes Dramatic Estate Planning Changes
Originally published in The CPA Journal.
CPAs Should Consider the Potential Impact
The Biden Administration recently released its fiscal 2024 revenue proposal, which includes many dramatic changes that will affect most aspects of estate planning. The first reaction of many is that this will not be passed with a Republican-controlled House. Although that might be true, one should never say never when it comes to Congressional action. With debt ceiling negotiations looming, there is no telling what deals might be made, even deals that might include one or more of the Biden Administration’s proposed estate tax changes. It is also important to note that many aspects of the administration’s estate tax proposals have circulated in similar forms for many years. Thus, even if these changes are dodged this round, they might not be avoided forever.
It is unlikely that many individuals will be motivated to take significant planning action based on the Green Book. Many people rushed to plan in 2012, 2020, and 2021 in advance of harsh anticipated tax changes, none of which came to pass. Thus, most clients are likely to be skeptical of a communication from advisors to the effect of “plan now, before major harsh tax changes are enacted.” Nonetheless, it would seem prudent for CPAs to caution clients about the proposals and that the implications should at least be considered. Some of the proposals will only be effective prospectively after the date of enactment. Others will affect every trust or plan no matter when done. So it would seem advisable to at least complete planning that makes sense before any of the laws might change. The following is only a brief overview of a portion of the many changes that have been proposed.
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