Revenues from the federal estate tax have fallen by 50% in just two years, according to new data from the IRS reported by Blomberg News.
In 2018, about 5,500 families paid more than $20 billion in estate taxes. In 2020, the IRS collected about $9.3 billion from 1,275 families.
“The dramatic decline – to the point where the tax is paid by 0.04% of dying Americans – is largely the result of the tax overhaul enacted by Republicans in 2017, which doubled the amount the wealthy can pass to heirs without triggering the levy,” Bloomberg’s Ben Steverman writes.
Estate tax revenue is expected to continue to decline, despite the surge in dynastic wealth in the country. Although Democrats have outlined various changes that would reduce exemptions and close loopholes in the tax, none of those proposals survived in the Build Back Better bill following resistance from moderates in the party.
