When it comes to the federal level and the estate tax, we’re all simply waiting for some word from Congress and the White House. As if that weren’t enough, we currently need to keep a sharp eye on our own state legislature and governor too.
Recently, Wealth Strategies Journal took a snapshot of 16 states considering amendments, higher exemptions, and even outright repeals. As you might expect, the results were mixed. The article is titled Multi-State Estate Tax Update: Much Activity - What Are The Results? The article mentions the State of Oregon as one of the states, but only mentions the legislation that passed last year which really didn’t change a whole lot. The exemption is still $1,000,000 but last year’s legislation cleared up some ambiguities and set the tax rate at 10% graduates it up to a maximum of 16%.
What the article did not mention was Ballot Measure 84, which will come to vote in November. This initiative, if passed, will phase out the Oregon estate tax by reducing the existing tax by 25% in 2013, 50% in 2014, 75% in 2015, and by January 7, of 2016, the will be zero. In addition to phasing out the Oregon estate tax, the initiative proposes a ban on any new tax on any property transfer among living family members and phases out capital gains tax on property sales within a family on the same schedule as the phase out of the death tax. If you want to learn more background information about Ballot Measure 84 you can go to the website www.endoregondeathtax.com.
Here’s the takeaway. With the state budget bleeding red ink, all sources of potential revenue are considered by many legislators as untouchable. I don’t believe there is a very good chance that it will pass. But, at least the issue has now come up.
With all the current uncertainty about what our federal and state estate tax laws will even be come January 2013, you need to make sure that your estate plan is flexible and contemplates the different possibilities of tax liability.
Reference: Wealth Strategies Journal (July 10, 2012) “Multi-State Estate Tax Update: Much Activity - What Are The Results?”
Schultz & Associates Law Center, P.C. is an Oregon law firm with offices in Eugene, Salem, and Roseburg, Oregon.