In this second blog post on the House Ways and Means Tax proposals, we address the proposed changes that will affect the taxation of trusts, estates, and retirement plans. As we discussed, on September 13, 2021, the Congressional House Ways and Means Committee introduced 880 plus pages of legislative tax proposals to help fund the House’s proposed $3.5 trillion stimulus package. Below is a summary of the trust and estate and retirement asset taxation proposals.
The House has not yet voted on the above-proposed legislation. If passed, the increased tax cost of holding assets in trust means that trustees need to revisit how often they distribute trust assets to beneficiaries to minimize overall taxation. In addition, private funds that have investors who invest their IRA assets in such funds could be significantly impacted. Please talk with your tax advisor if you have questions about any of the above proposals.