Proposed Transfer Tax Legislation Calls For Sweeping Changes

Senator Sanders has proposed the "For the 99.5 Percent Act" which would increase estate, gift and generation-skipping transfer tax rates, reduce estate, gift and generation-skipping transfer tax exemptions and significantly impact current estate planning strategies utilized to reduce the estate tax bite.  Senator Warren has proposed a wealth tax imposing a 2% annual tax on net worth in excess of $50 million and 3% on net worth exceeding $1 billion.  Senator Van Hollen has proposed the Sensible Taxation and Equity Promotion (STEP) Act which would eliminate the step-up in basis that currently applies on death by taxing unrealized capital gains when heirs inherit appreciated property with an exclusion of up to $1 million in gains.  These proposals are in addition to the Biden administration's American Jobs Plan and American Families Plan increasing corporate and individual income tax and capital gains tax rates.