Congressional Research Service Hints at More Estate/Gift Changes

A recent report by the Congressional Research Service (CRS) suggests that things should settle down, now, with respect to the estate and gift tax laws which were recently solidified. However, some perceived abuses remain, which might eventuate in further changes.

  • Family partnership discounts – Courts sometime allow estates to “discount” the fair market value of interests in family partnerships or family limited liability companies – even when assets such as marketable securities are held by such entities. There is a proposal on the table which would disallow such discounts.
  • Currently there is no explicit rule preventing a low valuation of fair market value for an estate and a higher valuation of the asset for purposes of stepped up basis in the hands of the heir. A proposal would require the same value for both purposes.