Almost a year into the presidency of Donald J. Trump, the world of global finance is changing. While lawmakers work toward tax-law changes, many advisors are trying to anticipate those changes and how they will affect us and our client-families’ future wealth.

The truth is, we don’t know what the new tax structure will be. But change is not a new concept to estate planners, we have been there before; and as a result, we now draft wills and trust documents with multiple options. This strategy permits postmortem planning, to ensure that our clients’ intentions are achieved in these uncertain times.

If President Trump and his supporters successfully eliminate the federal estate tax, that one change alone will have a significant impact at the state level. Federal repeal would make it difficult for states to maintain their own estate taxes. Of the 14 states and the District of Columbia that levy such taxes, all but one depend on federal estate-tax rules for administering their own estate tax. Many states have tied their estate-tax exemptions to the federal exemption amount and may need to take action to decouple.


These legislative moves are important to financial advisors because valuing the  assets in a large estate is no simple matter. The rules surrounding some of the deductions allowed against the asset amounts are similarly complicated.

Without a federal estate tax, states would have to re-create and update the rules and the forms for themselves.

What if the states ultimately also repealed their estate tax? The lost revenue could result in increased state income taxes. At the same time, federal income taxes are expected to decrease in the near future. For those living in a high-income-tax state such as New York, the federal tax savings could equal the potential state income tax increase.

But, whatever the eventual change, bring it on; we advisors are ready. As a famous French editor once put it, “The more things change, the more they stay the same.”

This article is distributed with the understanding that CBIZ is not rendering legal, accounting or other professional advice. To the extent anything herein could be construed as tax advice, such advice is not intended to be used and cannot be used to avoid penalties under the Internal Revenue Code, or to promote, market or recommend to another person any tax-related matter. This information is general in nature and may be affected by changes in law or in the interpretation of such laws. The reader is advised to contact a professional prior to taking any action based upon this information. CBIZ assumes no liability whatsoever in connection with the use of this information and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.