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Tax Tip: Estate Tax Planning In 2022 With No Changes in Sight

Dec. 30, 2021, 9:45 AM

Practitioners became concerned in the second half of 2021 about potential estate tax law changes including rate increases; a decrease in the exemption; elimination of valuation discounts; limits on GRATs; grantor trust changes; and forced recognition of gains in non-grantor trusts. Due to their concerns, taxpayers were also concerned. In the end, it was a comedy by William Shakespeare: “Much Ado About Nothing.”

For 2022 we look, again, to Shakespeare, this time to “The Tempest.” “What’s past is prologue": The estate tax laws will not change.

Why can we be so confident in making this prediction?

Two senators, who are Democrats, face reelection in 2022. Both won their last races by narrow margins. Sen. Maggie Hassan (D-N.H.) won last time by 0.1% in a state the president won by 7.2%. On Nov. 24, 2021, Fortune reported a negative 2% favorability rating for the president in New Hampshire. Sen. Catherine Masto (D-Nev.) won last time by 2.4% in a state the president won by 2.4%. The same article reported a negative 3% favorability rating for the president in Nevada.

In 2022 taxpayers should do estate tax planning because it is a good idea, not out of fear of imminent changes in the law.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Author Information

Bruce Givner, Esq. is of counsel to KFB Rice, LLP in Los Angeles, California

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To contact the reporter on this story: Kelly Phillips Erb in Washington at kerb@bloombergindustry.com