President Donald J. Trump signed a bill last Thursday that will allow wealthy individuals to transfer up to $15 million to their children without having to pay any federal taxes. The legislation includes a permanent exemption for up to $15 million in estate taxes, which was originally introduced in Trump’s 2017 tax cut bill.
Critics argue that this permanent exemption is an unnecessary windfall for the wealthy, adding to the bill’s overall cost without real justification. They point out that inherited wealth is essentially a lottery win and should be subject to taxation. Defenders of the bill argue that making the exemption permanent provides “certainty,” but critics say this is a weak argument, selectively used when no stronger justification exists.
While the bill includes temporary tax cuts for other areas, such as car loan interests and contributions to newborns, these provisions will sunset when Trump leaves office.
Estate tax exemption finalized
Since his initial campaign in 2016, President Trump has made it clear that rewarding Americans who inherit their wealth is a primary goal.
This bill is another step in that direction now that it has become law. The estate tax exemption has largely gone unnoticed amid several other controversial provisions in the bill that have garnered widespread attention. However, this significant change is the result of a decades-long effort by Republicans to reduce the estate tax burden.
Historically, the notion that tax cuts for the wealthy lead to economic benefits has been repeatedly debunked. Critics say the permanent exemption adds to the bill’s overall cost without real justification. The bill passed on Thursday and was signed into law by President Trump at the White House.
It allows wealthy individuals to transfer a significant amount of money to their children tax-free, fulfilling one of Trump’s long-standing goals since his initial presidential campaign.
