Let’s talk taxes. (Wait! Don’t leave. This one actually matters.)
There’s a big proposal in the works that could affect millions of families—eliminating the step-up in basis. And if that happens? You or your loved ones could end up selling off the family home just to pay the IRS.
At Norton Estate Planning & Elder Law Firm, we’re not here to panic—we’re here to plan. Let’s break it down.
What Even Is Step-Up in Basis?
Say your mom bought a house in 1980 for $100,000. When she passes, it’s worth $1 million. Right now, you inherit it at its current value ($1 million), and if you sell it? No capital gains tax. 🎉
If step-up in basis goes away, you inherit the original purchase price. Sell it for $1 million, and you’re paying taxes on a $900,000 gain. That’s a gut punch.
Who Gets Hurt?
Not just the ultra-wealthy. Middle-class families with:
- Long-held family homes
- Rental properties
- Small businesses
- Stock portfolios
…are the ones who could be hit hardest. Why? Because they might not have the cash to cover those taxes, and selling off treasured assets might be the only option.
What Can You Do Now?
No need to sound the alarm (yet), but it is time to get strategic:
- Use trusts smartly. The right structure can offer serious tax benefits.
- Gift assets now. Get ahead of potential tax changes.
- Consider life insurance. It can cover tax bills without touching the house.
- Look at your investment mix. Roth IRAs and similar accounts can help.
- Make a charitable move. Gifts to donor-advised funds can reduce taxes and support causes you care about.
Bottom Line: Don’t Wait for Congress to Decide Your Future
Tax laws can (and do) change. The best way to stay protected is to have a flexible, updated estate plan that can adjust to whatever curveballs Washington throws next.
We’ll help you get there.
👉 Request a free consultation to explore your options and make sure your legacy doesn’t get taxed into oblivion.
