One bill, written by five senators, proposes a progressive estate tax structure. According to Senator Bernie Sanders, the bill’s sponsor, “99.7% of Americans would not pay any estate tax whatsoever.” The bill states:
- The first $3.5 million ($7 million for married couples) of an estate is exempt from federal taxation.
- Estates valued over $3.5 million and under $10 million would be taxed at 45%
- Estates valued over $10 million, but under $50 million would be taxed at 50%
- Estates valued over $50 million would be taxed at 55%
- Estates valued over $1 billion would have an additional 10% surtax
The second bill being discussed is a bi-partisan effort from two members of the Senate Finance Committee. While the bill has not been proposed yet, it reportedly includes a 35% top rate, and excludes any estate under $5 million ($10 million for couples). The bill may also include an incentivized pre-payment concept, wherein a person could pay a lower estate tax if they pay up before they pass on.
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