Repealing the Death Tax Would Create 1.5 Million Jobs

Curtis Dubay / November 09, 2009

Congress will take up debate on the dreaded Death Tax once again in the coming weeks. It will do so because the Death Tax expires for one year starting January 1, 2010. But like the villain in a horror movie, it will rise from the dead with its full power in tact on January 1, 2011. The one-year expiration will likely incite Congressional debate because some would like to keep it from expiring this year all together.

The one year abolition of the tax is the end of a years-long process of reducing the tax that began as part of the 2001 tax cut. The 2001 cut reduced the rate of the Death Tax incrementally from 55 percent to 45 percent this year. During the same time the exemption, or amount of an estate that is not subject to taxation, increased from $1 million to $3.5 million. After a period of winding the tax down, the 2001 tax cut abolished the Death Tax for 2010. Because of the rules governing the cuts, the tax only disappears for one year before it comes back from the dead with a rate and exemption it had before the cuts (55 percent rate and $1 million exemption). (more…)