Impacts of the Trump Presidency on Estate Planning: Your Quick Guide
Estate Planning Under Trump
It’s official — at 12:00 p.m. on January 20th, 2017, Donald J. Trump was inaugurated as the 45th President of the United States of America, in essence completing the 2016 presidential election cycle. With that bit of uncertainty behind us and a fresh administration starts out, here’s what you need to know about estate planning under Trump administration and Republican-controlled Congress.
President Trump’s tax plan
With a new administration in the White House, it usually means major shakeups in fiscal and tax policy, and Trump’s tax plan is no exception. Here are several of the proposed changes we will potentially see rolling out during this administration:
- The repeal of the estate tax
- Lower income tax rates
- The introduction of a tax deduction for childcare costs
- Dependent care savings accounts (DCSAs) with conditional matching
- The switch from seven to three tax brackets
- Increased standard joint deduction from $12,600 to $30,000
- Increased itemized deductions cap from $100,000 to $200,000
- Decrease in business tax from 35 percent to 15 percent
Of these proposed changes, the repeal of the estate tax, also known as the “death tax,” means your assets would not be taxed by the federal government upon your death and would transfer in full to your beneficiaries. It is also predicted that the gift and generation-skipping taxes may be repealed as well. All of these actions could result in a greater ability to keep wealth within your family, but we will have to wait until we see the final legislation to know the exact mechanics. Another thing to understand in terms of estate planning under Trump is that the proposed changes would also negatively impact taxation on charitable gifts and other philanthropic gestures contained in your estate plan.
Estate taxes differ from state to state, so the wisest move in your playbook is to go over your estate plan with an experienced estate planning attorney to discover how these changes may impact its other components.
That being said, proposed policy changes must go through Congress, which has its own agendas and ideas about fiscal and tax policy. So, staying on top of new developments pertaining to estate planning under Trump, and in close contact with your team, will help ensure that you will be prepared for whatever unfolds over the coming years.
More benefits to trust-based planning
There are also many non-tax-related benefits to trust-based planning that you can take advantage of, regardless of which proposed changes take place under the new administration and Congress. Just a few key benefits of trust-based planning include:
- Greater privacy for your family and avoidance of probate
- Incapacity protection and avoidance of conservatorship or guardianship
- The creation of lifetime beneficiary directed trusts providing long-term asset protection benefits to your heirs
Give us a call today
Not even the nation’s top financial experts know exactly how Trump’s presidency and the Republican-run Congress will impact estate planning best practices for every citizen, but a skilled estate planning attorney can guide your efforts for estate planning under Trump in a smart, careful, and decisive manner.
At McDonald Law Firm, we’re here to help you navigate policy changes to ensure your estate is managed as beneficially as possible for you and your family for generations to come. Contact us today at (443) 741-1088 to schedule a no obligation consultation to get the ball rolling on preserving your family’s legacy.
DISCLAIMER: THE INFORMATION POSTED ON THIS BLOG IS INTENDED FOR EDUCATIONAL PURPOSES ONLY AND IS NOT INTENDED TO CONVEY LEGAL ADVICE.