On February 28, 2024, Kiplinger quoted Larry Mandelker on provisions in the 2017 Tax Cuts and Jobs Act (TCJA) that may expire in 2025.
According to the article, provisions in the TCJA that lowered individual tax rates, doubled the standard deduction, and shielded the vast majority of estates from federal estate taxes are scheduled to expire on December 31, 2025. Many Republicans in the House of Representatives have called for making the individual tax provisions of the TCJA permanent, and President Biden supports extending the individual tax cuts for most families but wants to pair the extension with higher taxes on high-income households and corporations. If Congress and the White House fail to reach an agreement by the end of 2025, tax rates will automatically revert to 2017 levels.
An end to the individual tax provisions in the TCJA would also increase the number of taxpayers who are subject to the federal estate tax. In 2024, up to $13.61 million in assets is exempt from estate tax, or up to $27.22 million for a married couple. If the law expires, the exemption will drop to half of that amount, on an inflation-adjusted basis—about $7 million for a single person or $14 million for a couple.
Mandelker explained that while the majority of taxpayers would still be exempt from federal estate taxes under those thresholds, a couple with a well-funded retirement account, a home they’ve owned for many years, and other taxable assets could end up owing estate taxes, “even though they’re not rolling in money,” he said.
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