No agreement was reached in time to prevent the repeal of the estate tax in 2010, but changes may be afoot. The U.S. Treasury Secretary, Timothy Geithner, made statements yesterday indicating that he believes Congress should collectively reinstate the estate tax and make it retroactive to the first of the year to cover the estate assets of all decedents.
The statements made by Geithner echo the sentiment of Senate Finance Committee Chairman Max Baucus, who has also voiced concern over the repeal of the tax and indicated he would like to see a retroactive estate tax law enacted. Geithner made his statement before a panel of members of the Senate Finance Committee on Tuesday, urging members of Congress to tackle this issue early in the year.
President Obama has proposed in his 2011 budget, which was unveiled Monday, that the estate tax mirror that which applied in 2009. This would include a maximum tax rate of 45% on individual wealth exceeding $3.5 million, or $7 million on the wealth accumulated by married couples. If no action is taken, the estate tax will not apply to the estates of decedents in 2010 and will return to apply to individual estates exceeding $1 million, or $2 million for married couples, at a maximum rate of 55%.
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