Update and Extend Earlier Estimates of Proposals to Modify The Estate Tax

Update and Extend Earlier Estimates of Proposals to Modify The Estate, Gift and Generation Skipping Transfer Taxes

In this memorandum we update and extend our earlier estimates of three (3) proposals to modify the existing estate, gift and generation skipping transfer tax (GST).

These updated estimates will take into account the recent changes to the estate tax enacted as part of the “Tax Cuts and Jobs Act” enacted in December of last year. The proposals relate to repeal of the estate, gift and GST tax as well as lowering the maximum tax rate on wealth transfers.

Because the recently enacted changes substantially increased the thresholds at which estates become subject to the tax, the estimated revenue effects will be less under the new, present law baseline because fewer estates will now be subject to the tax.

In simulating these revenue effects we will rely on the most recently available data from the Internal Revenue Service on estate and gift tax returns filed in 2016. We will also incorporate the most recent forecast of the U.S. Economy by the Congressional Budget Office (CBO). As before, we will adopt the Joint Committee on Taxation (JCT) assumptions as to the likely behavioral changes that these changes will induce.

Read the complete “Update and Extend Earlier Estimates of Proposals to Modify The Estate, Gift and Generation Skipping Transfer Taxes” report.