The Trump Administration and the “Big Six” have provided a general framework for tax reform and are promising to release more details as early as this week. While tax reform is still subject to significant changes in scope and direction, we are left to ponder a number of possibilities when it comes to future C corporation and pass-through entity tax rates.
With the August Recess upon us in the United States Congress, it is a good time to sit back in our chairs and survey the landscape. In the last several months, we have gained some clarity on the future (or lack thereof) of the proposed 2704 regulations. On the other hand, tax reform has not advanced very far. The first six months of the Trump Presidency have included several public statements as to the direction of tax reform and the emphasis of potential legislation. There has been more substance with respect to regulations, including listing the proposed 2704 regulations as significantly burdensome and in need of a thorough review. Meanwhile, major healthcare reform has not occurred.
I reviewed what has been said and written in the wake of Thursday’s release of the Trump Tax “Plan”, and watched a video of the Cohn/Mnuchin press conference. There appears to be a lack of detail in what amounts to a one-page plan containing core philosophies / talking points / bargaining positions. The “Plan” focuses on corporate taxes and individual income tax rates, but also calls for immediate repeal of the death tax. There is no mention of gift tax, GST, carryover basis, or otherwise. Therefore, it is difficult from an estate planning perspective to draw too many conclusions from this “Plan.”
We are in a period where many estate planners are increasing their focus on matters other than the federal exemptions. Some practitioners are contemplating the balance between minimizing estate and gift tax with minimizing income tax...