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The Wall Street Journal Quotes Beth Kaufman: Obama Takes Aim at 'Step Up' Tax Break on Inherited Assets

January 20, 2015, The Wall Street Journal
The Wall Street Journal quoted Beth Shapiro Kaufman regarding President Obama's proposal to impose capital-gains tax on gifts made during one's lifetime. For the complete article, please visit The Wall Street Journal's website.

Excerpt taken from the article.

Under the Obama proposal, such gifts made during one's lifetime would trigger capital-gains tax. The proposal doesn't say whether the giver or the recipient would pay the tax. Beth Kaufman, a lawyer with Caplin & Drysdale in Washington, speculates that the giver would bear the tax, and the recipient would receive an asset with a cost basis of current market value.

The answer to another important issue for wealthy people is unclear, based on the description in the president's proposals, she says. Namely, would the capital-gains tax imposed at death be deductible from the estate tax? If it isn't, she notes, then the combined federal capital-gains and estate-tax rate at death would be 68%—plus any state levies due.

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