Changes in tax policy, among other platform proposals, will likely turn on the state of Georgia’s runoff elections for its two U.S. Senate seats. The Senate runoff elections will occur on January 5, 2021. Georgia holds an early runoff election for local officials on December 1, 2020, but the federal runoff election will not occur until January 2021.
In the Georgia runoff elections, it appears that Democratic wins in both races will secure majority control of the Senate. A Democratic majority can be obtained with 50 members, through the Vice President’s tie-breaking vote as President of the Senate.
Our nation’s first Vice President, John Adams, exercised this power more than any other Vice President. Given the current polarization among the parties and the potential 50-50 divide in the Senate, the 2020 election could set the stage for our country's most active Vice President since George Washington was President.
The Biden Harris campaign has proposed an immediate repeal of the 2017 Tax Cut and Jobs Act, which provides many tax benefits to small business owners and the record high estate and gift tax exemption ($11.58 million).
Democratic control in both houses of Congress and the White House paves the way for implementing sweeping changes on platform issues, which include taxes. History tells us to expect these types of changes, and you do not have to look far to see evidence. The Trump administration implemented sweeping changes under the same conditions; the Obama administration implemented sweeping changes under the same conditions; and the list goes on…
Our October 15 blog post: www.wealthlaw.net/blog/2020-election-and-your-estate-plan has more details of some of the tax specific changes proposed by the Biden Harris Campaign and the Democratic party.
The impact of the potential changes is significant for small business owners and from an Estate and Tax Planning perspective. For estates in excess of $3 million, the proposed tax changes will likely have a material impact on your estate.
Now is the time to act and implement appropriate planning.