Last week, the so-called "Estate Tax Reform Act" (H.R. 4154), passed the House by a 225-200 vote. The House legislation would change current law, making the Death Tax permanent at 45% with an exemption of $3.5 million.
In 2001, Congress passed tax reform that featured a phase-out of the Death Tax over a ten year period, ending with a full repeal for one year in 2010, before returning in 2011 at a rate of 55% for estates valued at more than $1 million.
Death Tax reform must now be addressed by the Senate, which plans to consider its own version. Before a change to Death Tax law is made, the Senate and House must reconcile the difference between their two bills and put the compromise before the President. However, the Senate may not address Death Tax until early next year. As full repeal is not likely in the Senate this year, FLA continues to fight for true Death Tax reform. In the Senate, FLA supports the Kyl-Lincoln language which would reform the Death Tax by reducing the rate down to a maximum 35% and raise the exemption to $5 million.
FLA advocates for Death Tax reform and repeal as this tax continues to contribute heavily to unsustainable forest landscapes. As forest landowners continue to struggle through declining traditional markets, government-restricted access to new markets and a growing population, onerous tax bills to the heirs of family forestland means harvesting timber prematurely and selling or fracturing land for development and other uses.
Find out how your member of Congress voted.