I am very relieved to find out that the bill just passed by Congress to avert the fiscal cliff finally dealt with the federal estate tax and removed much of the uncertainty that we have been dealing with for the last two years. Here is a quick summary from Forbes:
ESTATE TAX: Always of significant interest to family-owned businesses. Estate tax was a bit of a mixed bag – the $5 million dollar per person exemption was kept in place (and indexed for inflation continued) however the top rate is increased to 40 percent – effective date January 1, 2013. This change to 40 percent increased revenues from 2012 policy by $19 billion dollars. Other good news for estate planning – portability is kept in place and estate and gift remains unified – ie the $5 million stays in place for gift tax purposes as well. All permanent law — hallelujah.
Click here to read the full article about all of the changes that affect small business.