Senator Sanders Introduces “99.5% Act” Which Would Increase Estate Taxes and Overhaul Estate Planning
March 26, 2021
Types : Alerts
Senator Bernie Sanders has introduced in the Senate what he calls the “99.5% Act” (the “Act”). For individuals dying and gifts made after December 31, 2020, the Act would substantially increase the federal estate and gift tax by reducing the federal estate tax exemption from $11,700,000 to $3,500,000 per person and increase the estate rates from a maximum rate of 40%, to 45% on estates between $3.5 million and $10 million with further rate increases topping out at 65% for estates in excess of $1 billion. The retroactive application of a tax increase is a Constitutional matter which on a number of prior occasions involving the federal income tax has been approved by the federal courts, so a challenge to this increase in the federal estate tax seems likely to fail.
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