As a small-business owner, you fight for every advantage to find ways to save money and earn profit. Cutting costs and leveraging your time efficiently can be the difference between a good year and a great year. When facing these everyday challenges, you may not take the time to address a long-term issue—estate planning. However, if you look ahead and plan your estate carefully, your family and business will benefit.
Currently, the estate tax is a graduated rate based on an estate's size and caps at 46 percent. Recent proposals in Congress have sought to eliminate the estate tax, but each one has failed when it was brought up for a vote. In fact, many of the wealthiest families in the U.S. have lobbied against repeal, making reform or repeal more difficult.
With the recent changes in Congress, the prospect of estate tax repeal is all but dead for at least the near future. The previous Congress was unable to make many of the provisions of the current code permanent, and several will expire in 2010. This makes estate planning more difficult than ever because many provisions may expire in as little as four years. If no reform measures are taken, tax laws could revert to pre-2001 rates and roll back any and all tax-planning advantages implemented during the past six years.