Friday, April 10, 2009

The Estate Tax Debate is Heating Up

President Obama submitted to Congress, several weeks ago, his proposal for locking-in permanently the per-person exclusion from federal estate taxes at the level of $3.5 million (which is the level for 2009 but which, under current law, becomes unlimited in 2010 before reverting to $1 million in 2011).

Now, as the Obama proposal wends its way through Congress -- along with a host of other budgetary measures -- there is a push by Republicans and some Democrats to increase the per-person exclusion to $5 million rather than $3.5 million.

Ten Democrats have signed-on to the $5 million proposal, and commentators on both sides of the political divide are chiming in with their views on the proper shape of the federal estate tax.
  • In a piece in today's Washington Post (you can read it here), Michael Kinsley argues that the effort to increase the exclusion to $5 million is misguided.
  • In an editorial in yesterday's Wall Street Journal (you can read it here), the Journal's editorial board took the opposite position and applauded the Democrats for crossing party lines.