Summary
- Doubling of Estate Tax Exemption: Trump’s administration increased the federal estate tax exemption, allowing his children to inherit more wealth tax-free.
- These moves have been criticized for benefiting the wealthiest American families disproportionately, highlighting issues of wealth inequality and economic policy impacts.
How to pull off a heist: Netflix take notes
Donald Trump’s tenure as President of the United States from 2016 to 2020 was marked not only by his controversial political moves but also by decisions that significantly increased the wealth of his children.
As a billionaire real estate mogul, Trump had long been familiar with the mechanisms of wealth accumulation and preservation, and his presidency enabled him to leverage these mechanisms to benefit his family financially.
Wealth transfer at it’s finest
1. Revision of Estate Tax Laws
One of the most significant financial changes Trump made during his presidency was the alteration of the federal estate tax laws. In 2017, under the Trump administration, the Tax Cuts and Jobs Act was passed, which effectively doubled the estate tax exemption.
This law increased the per-person exemption from $5 million to $11.18 million, adjusted for inflation. For a married couple, this meant that they could shield up to approximately $22.36 million from federal estate taxes.
This change allowed Trump, and similarly wealthy individuals, to pass a greater portion of their wealth to their heirs tax-free, thereby securing a financial boon for his children.
2. Utilization of Dynasty Trusts
According to estate planning experts, the increased exemption provided a ripe opportunity for setting up dynasty trusts. A dynasty trust is a long-term trust designed to pass wealth from generation to generation without incurring transfer taxes for as long as the assets remain within the trust.
The strategic use of such trusts allows for the preservation and growth of wealth in a tax-advantaged environment. Experts like Martin Shenkman, a New Jersey estate lawyer, noted (to Forbes Magazine) that aggressive planning techniques could enable families to transfer significantly more than the exempted amount into these trusts, further enhancing the potential for wealth accumulation over generations.
3. Impact and Criticism (Just kidding nobody cared)
While these legal and financial strategies are available to any American, critics argue that Trump’s policies disproportionately benefited the wealthy, including his own family.
The direct benefits to Trump’s children, due to these legislative changes and their strategic application, underscore the intersection of wealth, power, and policy in ways that have long-term implications for economic disparity.
