- Estate tax. The Hillary Clinton plan propose increasing the highest estate tax rate to 45% and lowering the estate tax exclusion to $3.5 million. Donald Trump eliminates the estate tax entirely. Bernie Sanders would propose increasing the top estate tax rate to 65% and lowering the estate tax exclusion to $3.5 million.
- Income tax: Rates on ordinary income. Hillary Clinton wants to add a 4% tax on income over $5 million. Donald Trump establishes four tax brackets with rates of 0%, 10%, 20% and 25%. The top rate applies to income over $150,000 for single filers and $300,000 for joint filers. Bernie Sanders, likewise establishes four new brackets but these are 37%, 43%, 48% and 52%. The top rate applies to taxable income over and above $10 million. All other tax brackets would be raised by 2.2%.
Although it’s impossible to predict just yet how these income and estate tax proposals could influence you, and whether they would be successful, you need to work with a knowledgeable attorney who can help guide you regardless of the changes made. Attorneys who are familiar with the changes made legislatively and at the turn of every new presidential administration can help explain to you how this would trickle down to you and what you can do to prepare for it in advance.
Do not hesitate to reach out to a New Jersey estate planning attorney to learn more.