The IRS’ new Estate Tax rules, proposed Aug. 2, would increase estate and gift taxes by 30 percent or more and impact family businesses, according to the Hardwood Federation.
The regulations would specifically limit family businesses from placing a large amount of assets—millions of dollars from real estate, a business, etc.—into a company and restricting the owners’ ability to sell their portions. Since such portions are harder to sell, appraisers often reduce the actual value of those assets, which reduces the amount due in estate or gift taxes, according to the Wall Street Journal.
The Hardwood Federation said the new regulation resurrects a concept called Family Attribution—all families act in concert and everyone gets along and agrees—that it believes is untrue and had been rejected by courts in the past.
The proposed regulation is open for public comment until the end of the day today. The Hardwood Federation recommends submitting comments via The Family Business Coalition’s form.
