You thought your estate plans were set when Congress made “permanent” the $5 million estate-tax exemption enacted earlier this year. Well, “permanent” just means there’s no expiration date built into it. And a government that is desperate for money to spend can change the estate tax at any time. According to the Wall Street Journal:
The Obama administration proposed lowering the exclusion to $3.5 million for estate and GST taxes, and to $1 million for gift tax. Those amounts—a return to 2009 levels—would no longer be indexed for inflation….
If you feel like the estate-tax exemption limit has bounced around a lot, you’re right. It has been changing every few years since 2001. Even some lawyers who get to charge by the hour are frustrated.