Republican lawmakers are working to nix the federal inheritance tax, otherwise known as the “death tax.”
According to Fox News, U.S. Rep. Randy Feenstra (R-IA.) is leading the effort and has the support of more than 170 Republicans on the “Death Tax Repeal Act,” which is also getting support from Ways & Means Committee Chair Jason Smith (R-Mo.)
As Republicans aim to extend President Donald Trump’s 2017 Tax Cuts and Jobs Act before its provisions expire at the end of the year, a key measure set to sunset in 2026 is the doubling of the estate tax exemption.
Advocates of the federal estate tax highlight that it impacts only a small number of estates. According to recent IRS data, penalties apply to estates valued at approximately $13.9 million at the time of death.
In the Senate, Majority Leader John Thune (R-S.D.), is spearheading a similar bill, supported by 44 senators.
Feenstra and Thune contend that the tax is unnecessary and unfairly burdens family farms and small businesses in their home states of Iowa, South Dakota, and beyond.
“The death tax is an egregious double tax that unfairly targets American family farms and small businesses, directly threatening long-held farming traditions in rural Iowa and across the country,” Feenstra told Fox News Digital. “It is ridiculous that the federal government sends grieving families a massive tax bill when a loved one passes away.”
Should Republicans fail to extend Trump’s tax cuts before year-end, the estate tax would apply to estates valued at roughly $7 million or more, according to Modern Wealth Law.
A memo from House Ways & Means Committee Republicans last year indicated that everyday American households could see tax increases of over 20% if the tax cuts expire.
During his address to the Senate on Thursday, Thune said he wants to get rid of the tax “once and for all.”
“As a resident of a rural state filled with family farms and ranches, I have made death tax repeal a priority for a long time,” Thune said. “I was proud to secure a doubling of the death tax exemption in the 2017 Death Tax and Jobs Act. This double exemption has provided certainty to a lot of farms and ranches, and small businesses over the past seven years. But the expanded exemption is expiring at the end of this year. It is my hope that will not only extend this exemption, but that we will get rid of this fundamentally flawed tax once and for all.”
