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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: benwood who wrote (104870)5/25/2001 2:41:09 PM
From: Logain Ablar  Read Replies (1) of 436258
 
Ben:

I don't think so. Do the #'s and you'll see the tax has not gotten bigger. As an example lets say someone acq. a stock @ 10 and when they died it was @ $110. If its taxable in the estate then the estate pays a tax on the $110 (less the unified credit which it the tax effect of the exemption, now going to $1M, 2M we'll never see $4M). This can be 55% and then the inheritor has a steped up basis of $110.

If the estate is less than the $1M then you get the stepped up basis and no estate tax.

Even if estate tax abolished (for practical purposes its not with this bill) and the basis remains 10 you pay a l/t capital gains rate of 20% vs. 55% (with the 55% going down under new law).

It is a nightmare, not only from knowing the origial cost but also having supporting documentation.
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