Sheet metal & Air Conditioning Contractors’ National Association

Issue Briefs

Repeal/Reform of the Estate Tax


SMACNA supports permanent repeal or major reform of the estate tax favorable to intergenerational business transfers.


In 2001, Congress passed a $1.3 trillion tax cut package that included repeal of the estate tax. The estate tax rates will gradually decrease from 2002-2009, and full repeal will occur in 2010. However, repeal of the estate tax and all reductions in the tax rates are scheduled to “sunset” in the year 2011. The estate tax will be reinstated (at the full rate) unless legislation is passed to make the cuts permanent.


  • More than 70% of family businesses do not survive the second generation with 87% failing to last until the third generation. Studies indicate that the average family business spends nearly $50,000 for legal fees, accounting services and related advisors related to the payment of death taxes.
  • Federal estate tax rates have increased significantly since their implementation in the early 1900’s.  Families often must sell their small construction companies in order to pay the death tax. This in turn creates disruption for employees, customers and suppliers.
  • Construction companies are frequently family owned and are particularly hard hit by the death tax burden, since the value of these businesses is not in liquid assets.


Congress will address the repeal or reform issue in the summer of 2009. A bipartisan agreement will be sought to attempt resolution of the estate tax issue during this Congress. These bills should include:

H.R. ___ Death Tax Repeal Permanency Act (pending reintroduction)

Title: To make the repeal of the estate tax permanent.

H.R. 436, Certain Estate Tax Relief Act

Title: To repeal new carryover basis rules to prevent tax increases with $3.5 million exemption.

Sponsor: Rep. Earl Pomeroy (D-ND)

S. ___ Death Tax Repeal Permanency Act

Title: A bill to make the repeal of the estate tax permanent.

Sponsor: Sen. Jon Kyl (R-AZ) expected to reintroduce in 111th Congress.

Updated February 2009