---
url: 'https://www.fmjlaw.com/election-2020-estate-planning/'
title: 'Election 2020: How the Election Could Impact Your Estate Plan'
author:
  name: Georgie Stocks
  url: 'https://www.fmjlaw.com/author/gstocks/'
date: '2020-10-19T18:34:12+00:00'
modified: '2025-09-30T16:38:59+00:00'
type: post
categories:
  - 'Trusts & Estates Blog'
image: 'https://www.fmjlaw.com/wp-content/uploads/2020/10/AdobeStock_363608722.jpeg'
published: true
---

# Election 2020: How the Election Could Impact Your Estate Plan

As a result of the Tax Cuts and Job Acts of 2017 (TCJA), the federal gift and estate tax exemption doubled from 2017 to 2018, and is scheduled to continue to increase (as adjusted for inflation) until 2025. As of January 1, 2020, the federal estate tax exemption amount is $11.58 million, up from $11.4 million in 2019. The top marginal federal estate tax rate remains 40%.

What is scheduled to happen on January 1, 2026? The federal estate tax exemption amount will sunset and revert to 2017 levels (as adjusted for inflation). This applies only if no further legislative action is taken. However, since 2020 is an election year, the estate tax environment could be changing sooner than we think.

## *Democratic Party*

As currently outlined, the Biden tax plan addresses two major estate tax issues. First, the estate tax exemption could be reduced by approximately 50% from the current level of $11.58 million, bringing the exemption amount back to 2017 levels earlier than anticipated. Second, the current “step-up” rule as it relates to cost basis could be repealed. Currently, the existing “step-up” rule increases the cost basis for inherited assets to their full market value as of date of death. The repeal of this rule would likely mean a higher tax burden for recipients of inherited assets.

## *Republican Party*

If President Trump is re-elected, the current legislation would likely still govern. As noted above, the TCJA provisions related to the estate tax exemption are scheduled to sunset in 2025, meaning exemption amounts will be reduced to $5,000,000 for an individual or $10,000,000 for a married couple, as indexed for inflation

If you have questions about how the election could impact your estate plan or would like suggestions on how to move forward with your estate plan, our [Trusts & Estates](https://www.fmjlaw.com/practice-area/trusts-estates/) group is well-versed in different options to make your estate plan work for you, your family, and your goals.

***Contact [David Ness](https://www.fmjlaw.com/professional/david-m-ness/) ([david.ness@fmjlaw.com](mailto:david.ness@fmjlaw.com)) or [Karen Schlotthauer ](https://www.fmjlaw.com/professional/karen-a-schlotthauer/)([karen.schlotthauer@fmjlaw.com](mailto:karen.schlotthauer@fmjlaw.com)), and they will be able to assist you.***

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