Austin News

U.S. Senator John Cornyn, along with 45 Senate GOP colleagues, has introduced the Death Tax Repeal Act aimed at permanently abolishing the federal estate tax, commonly referred to as the death tax. Senator Cornyn stated, "An added financial burden is the last thing families should have to deal with in the wake of a loved one’s passing." He emphasized that repealing this tax would reduce hardship and provide greater financial opportunities for families, farmers, ranchers, and businesses in Texas.

The estate tax affects family-run farms, ranches, and businesses when an owner passes away. It not only imposes a direct financial burden but also necessitates costly estate planning. Businesses often need to reserve capital for potential future taxes instead of investing it back into their operations.

The proposed legislation seeks to eliminate the federal estate tax for individuals who die after its enactment. It also aims to repeal the Generation-Skipping Transfer (GST) Tax on wealth transfers that skip a generation and modify the Gift Tax by indexing it for inflation. Additionally, it proposes treating transfers into trusts as taxable gifts unless entirely owned by the donor or their spouse.

Senate Majority Leader John Thune and Senators Jim Banks, John Barrasso, Marsha Blackburn among others are cosponsors of this bill. The initiative has received backing from over 190 members of the Family Business Coalition and more than 105 members of the Family Business Estate Tax Coalition. These groups include prominent organizations such as the National Federation of Independent Business and the U.S. Chamber of Commerce.