With the 2020 election fast approaching, it’s time to look at how the two candidates’ policy positions for President of the United States might affect your estate planning and tax planning over the next four years. Luckily, both candidates released information on their tax plans for the country.

President  Donald Trump’s tax plans  fall into two basic categories: ending our reliance on China and creating jobs. His policies proposals include:

The tax plan doesn’t detail what will happen with business tax cuts passed as part of the  Tax Cuts and Jobs Act  (TCJA). Moreover, while the administration imposed more than $80 billion in tax increases through tariffs, President Trump’s formal policy positions don’t explain how his administration will handle these tariffs in the coming years. However, he has said that he will impose tariffs on companies that fail to move jobs back to the U.S.

According to the Tax Foundation, it is difficult to definitively indicate how much individual or corporate tax rates will be affected by Trump’s proposed policies.

Former  Vice President Joe Biden’s plans  include:

Overall, the Tax Foundation indicates that Biden’s plans would decrease the tax rate for the top 1% of income earners by an average of 6.5% and decreasing income tax for all taxpayers by 1.7% on average.

Under the current law, the lifetime estate exclusion amount is $11,580,000 per taxpayer or $23,160,000 per married couple. The current tax rate for estates over that amount is 40%. The current estate tax exemption will expire in 2025. If it expires, the exemption will revert to $5 million per individual or $10 million per married couple.

Trump has not issued any policy positions indicating whether a future administration will extend the TCJA and the current estate tax exemptions. Still, the administration has indicated they would like to see them become permanent. Biden has not indicated a specific estate tax amount that he favors; he has said he would like to see the exemption return to “historic norms.” Presumably, this means he would like the estate tax exemption to return to $5 million per individual and $10 million for a married couple.

No matter what happens in the 2020 election, we can help you with your estate plan and explain how new tax laws will affect you. Contact the experienced  Orlando estate planning and tax attorneys  of Veliz Katz Law for a consultation, and we can discuss your options.  Contact us.