Estate Tax Repeal, or Revision?

The Senate is considering options to reduce or eliminate the estate tax. The estate tax, which currently taxes fortunes over $2 million at 46 percent, is estimated to affect the estates of 12,600 taxpayers in 2006. There are currently discussions on whether the repeal of the estate tax should be made permanent or altered to apply to fewer estates. Before the estate tax is permanently repealed it is important to understand the alternatives to repeal and the distributional and foregone tax costs of the various options on the table. The TPC has produced preliminary estimates of the distributional effects of some of the options reportedly under consideration and examines some of the implicit tradeoffs of repeal and some unintended consequences of repeal.

For more on the estate tax, see:

"'Death Tax' Repeal Unfair to Those Who Owe 'Birth Tax'", Diane Lim Rogers, May 31, 2006.

"Estate Tax Reform: A Third Option", C. Eugene Steuerle, July 18, 2005.

"Options to Reform the Estate Tax", Leonard E. Burman, William G. Gale and Jeff Rohaly, March 23, 2005.

"Effects of Estate Tax Reform on Charitable Giving", by Jon M. Bakija and William G. Gale, July 10, 2003.

"The Estate Tax Is Down, But Not Out", by Leonard E. Burman and William G. Gale, December 1, 2001.

"Current Law and Estate Tax Proposals: Effect on Returns and Tax Liability, 2007-16", June 7, 2006.

"Distribution of Possible Estate Tax Compromises".

More Commentary and Analysis on the Estate Tax.