In This Section

Share

Relief from the Estate Tax

NFIB has led estate tax relief efforts by forming the Family Business Estate Tax Coalition, a grassroots organization dedicated to full, permanent repeal of the estate tax. The estate tax provides no incentive for small and family-owned businesses to expand their business or create new jobs. In fact, it taxes the family right out of business.
 
Much of the cost of the estate tax occurs before the tax itself is levied. This tax applies to property transferred at death if the value of the property exceeds the estate tax exclusion. While the owner of the estate is responsible for the tax, their heirs often are responsible for the actual payment of the tax upon the death of the owner. The value of the estate to which the tax is applied includes all property the owner has an interest in at the time of death, including life insurance, annuities, and business assets. The threat of this tax actually forces small business owners to pay for expensive estate planning if they want to keep their business in their family. 
 
 
Watch NFIB member Patricia Baldwin, owner of Reliable Contracting in Millersville, MD talk about how the estate tax effected her family's business after one of the principal owners died.


In 2010, NFIB and FBETC supported estate tax legislation (H.R. 4853 Middle Class Tax Relief Act of 2010) which was a bipartisan tax compromise providing relief to the nation’s family businesses. 
 
Key Provisions of H.R. 4853 include:
 
  • An exemption of $5 million, effective January 1, 2011.
     
  • Exemption amount is indexed beginning in 2012.
     
  • A tax rate of 35%, effective January 1, 2011.
     
  • The continuation of “stepped-up basis” meaning the value of transferred property is adjusted for inflation after death.
    Small businesses have created nearly 70 percent of the net new jobs over the last decade but they need the tools to do it.  This bill ensures that small businesses keep more of their hard-earned money to invest in their business and create new jobs.

Protecting small business from the estate tax is important in order to keep Main Street family businesses in business for future generations.


FBETC Learn about NFIB's involvement in the Family Business Estate Tax Coalition (FBETC), a grassroots organization comprised of individuals, businesses, trade associations, and others in a unified effort to fully and permanently repeal the estate tax.