Ballots to Beneficiaries: How Potential Presidential Policies Could Shape the Future of
Your Estate Plan
Ready or not, we are entering another presidential election season.
If you are like most Americans, the economy is top of mind when it comes to evaluating the
candidates. But even if you do not intend to vote, the tax policies of the next administration
could have a major impact on your personal wealth and estate planning strategies.
Tax Legislation Is on the Horizon
In the area of tax policy, the 2024 election is set to leave its mark.
The Tax Cuts and Jobs Act of 2017 (TCJA) is expiring at the end of 2025, and with its expiration
will come the undoing of its individual and other tax provisions, including lower personal income
tax rates, higher standard deductions, increased estate tax exemptions, and the expensing of
business investments.
Many tax experts have said that major new tax legislation to replace the TCJA is all but assured
from the incoming Congress. What the candidates promise on the campaign trail over the next
few months could go a long way toward setting tax policy priorities.
Evaluating the Candidates Through an Estate Planning Lens
There is historical precedent for tax policy changes following a candidate's promises made
during campaign season.
John F. Kennedy promised to lower income taxes in 1960, paving the way for lower individual
and corporate tax rates in the Revenue Act of 1964. In 1980, Ronald Reagan hinted at what
would become the Economic Recovery Act of 1981, which lowered estate and capital gains
taxes. And in 2016, Donald Trump foreshadowed tax policies of the TCJA in speeches and
debates.
Candidates are unlikely to use the term estate planning, but they frequently use the language of
tax policy to discuss issues that affect a person's estate value and the inheritance they leave
behind. Here are some key policy terms to pay attention to from an estate planning perspective:
- Capital gains tax: A tax on the profit earned from selling an asset (such as stocks or real
estate)
- Estate tax: A tax on the transfer of property upon one's death
- Gift tax: A tax on the transfer of property from one individual to another during their lifetime
without receiving full value in return
- Income tax: A tax on the income of an individual or entity
- Tax credit: An amount that taxpayers can subtract from their total tax liability
- Tax deduction: A reduction in taxable income, potentially decreasing or eliminating tax
liability
- Tax exemption: A monetary exclusion that reduces the amount of taxable income
- Trust income tax: A tax on the income generated by a trust
What the 2024 Candidates Are Saying About Estate-Planning Related Taxes1
The publicly stated views of the 2024 candidates reveal clear contrasts in their visions for
America's economic future. Here is what the candidates have said about estate, wealth, and
capital gains taxes.
President Joe Biden
President Biden would reportedly tax long-term capital gains and qualified dividends at ordinary
income tax rates for taxable income over $1 million and tax unrealized capital gains at death for
amounts exceeding a $5 million exemption ($10 million for joint filers).2 He has also proposed a
minimum effective tax of 20 percent on unrealized capital gains from assets such as stocks,
bonds, and privately held companies; higher top individual income tax and corporate income tax
rates; and tighter estate tax rules to reduce inherited wealth accumulation.3
Former President Donald Trump
Former president Donald Trump has said he plans to make permanent the 2017 individual tax
cuts that he enacted during his term under the TCJA.4 He also wants to make the expiring
estate tax cuts from the TCJA permanent.5 The unified gift and estate tax exclusion amount is
set to expire on December 31, 2025, and revert to pre-TCJA levels that are expected to be
around half of what they are in 2024 ($13.61 million per individual/ $27.22 million per married
couple).
Robert F. Kennedy Jr.
The only major tax policy that RFK Jr. has announced, according to the Tax Foundation, is
exempting Bitcoin from capital gains taxes when the cryptocurrency is converted to or from US
dollars.6 He has also expressed a desire to make tax code changes to discourage corporate
ownership of single-family homes.7
Chase Oliver
Although the Libertarian Party's candidate, Chase Oliver, has addressed many issues during his
campaign, such as immigration, student loans, and closing regulatory loopholes that reward
businesses with close relationships with government officials,8 he has not spoken on too many
issues that would impact estate planning. However, the Libertarian Party has traditionally been
in favor of limited government, the repeal of the income tax, and the abolishment of the Internal
Revenue Service.9
Jill Stein
The Jill Stein 2024 platform calls for raising taxes on the richest Americans. This includes
applying the Social Security payroll tax to capital gains and dividends, as well as increasing the
estate tax.10
Cornel West
West's platform is focused on economic justice but light on economic policy details. His
campaign site says that the candidate would impose a wealth tax on all billionaire holdings and
transactions and close all tax loopholes for the oligarchy.11
Future-Proofing Your Estate Plan
Changes to the law are one of the primary reasons to revisit your estate plan. We will be
following this year's election closely so we can keep you informed about policy changes that will
help you make proactive adjustments to your plan, such as using estate planning tools to lock in
the "bonus" estate tax exemption and manage possible capital gains exposure.
We cannot predict election outcomes, but we can create an estate plan that protects your
estate, your legacy, and your heirs through political shifts. To learn more, please contact us.
MEREDITH | PC
4325 Windsor Centre Trail
Suite 400
Flower Mound Texas 75028
214-513-1013
This newsletter is for informational purposes only and is not intended to be construed as written advice about a Federal tax matter. Readers should consult with their own professional Counselors to evaluate or pursue tax, accounting, financial, or legal planning strategies.
You have received this newsletter because I believe you will find its content valuable. Please feel free to Contact Me if you have any questions about this or any matters relating to estate planning.
