New Podcast: Dick Patten of the American Family Business Institute on Estate Tax Reform
June 16, 2010
On this week's Tax Policy Podcast, Dick Patten, President of the American Family Business Institute (AFBI), discusses the federal estate tax, which has been completely repealed for 2010 — but only for this year. The tax is scheduled to come back to life on January 1, 2011 at a higher rate of 55% with the lower exemption level of $1 million.
President Obama has proposed making permanent 2009 estate tax policy (a 45% rate and an exemption level of $3.5 million). AFBI advocates for permanent repeal, but an alternative proposal has been put forth by Sens. Kyl and Lincoln for a 35% rate and an exemption of $5 million.
"It really is a question of, 'Will we have a 35% death tax in our future or a 55% death tax in our future?'" Patten says. "Our organization of course exists so we have no taxation at death. If we can make a step from 55% to 35% this year, at least that would save America's family businesses and American's family farms 20% of their net worth. And as a step in this particular Congress, that would be a step in the right direction."
For more on the estate tax, visit Tax Foundation Special Report, No. 179, "The Federal Estate Tax: Will it Rise From the Grave in 2011 or Sooner?" or visit the estate and gift taxes section of the Tax Foundation's website.