When President Trump released his list of proposals for changes in the tax code (aka, the “2017 Tax Reform for Economic Growth and American Jobs”), one of the 19 bullet points was “Repeal the death tax,” thrusting estate and gift taxes back into the national debate.

As a refresher: The federal government taxes estates at up to 40 percent but provides an exemption for individuals up to $5,490,000 in 2017 and twice that amount for married couples.

The high threshold makes the estate tax applicable to very few Americans. In 2015, only 11,917 estates filed estate and generation-skipping transfer tax forms with the IRS. As the exemption amount increases, the number of those filing should decrease. The Tax Policy Center estimates that about 11,000 individuals dying in 2017 will leave estates large enough to require filing an estate tax return, which will total nearly $20 billion. “Nearly 70 percent of these taxable estates will come from the top 10 percent of income earners and over 25 percent will come from the top 1 percent alone.”

As for the impact on small farms and closely held businesses, which the Trump administration claims are burdened by the estate tax, the Tax Policy Center estimates that they will pay $20 million in estate tax in 2017, 0.1 percentage of the total estate tax revenue.

If you are fortunate enough to actually inherit money, with or without taxes, keep in mind that a windfall can cause unforeseen difficulties. That’s why it’s important to avoid critical mistakes in order to make the process go more smoothly.

MISTAKE NO. 1 Spending mindlessly. It can be tempting to go out and make a big purchase, but until you have developed a long-term game plan, slow down and try to avoid spending on what you may tell yourself is “just a small indulgence.” A series of those purchases can morph into bigger ones that might rob you of your ability to reach your overall goals for the inheritance.

MISTAKE NO. 2 Going it alone. Maybe you manage your 401(k) plan or even breeze through your tax preparation, but when anyone receives a windfall, whether it’s an inheritance or even lottery proceeds, it can be helpful to assemble a team, including an estate attorney, an accountant and a certified financial planner. The team will help guide you through the process and as importantly, create a long-term plan for how the inheritance can be used to achieve your financial goals.

advertisement | advertise on newsday

MISTAKE NO. 3 Making decisions too quickly. It took someone a lifetime to accumulate an estate, which is why you need to be careful not to make any big life decisions, such as selling a house or quitting a job, too early in the process. Use your team to help create a timeline of goals and remember that an inheritance often coincides with loss, so give yourself enough space to grieve.

MISTAKE NO. 4 Becoming paralyzed in the investment process. Sometimes people who receive a lump sum become so worried about “investing at the top” that they become immobilized and do nothing. One way to conquer this fear is to consider dollar cost averaging, the investment strategy that divides the available money into equal parts and then periodically invests the money in a diversified portfolio over time.

MISTAKE NO. 5 Providing for everyone except yourself. You love your kids. You love your friends. You love your charitable organizations. That said, until you have thought through your plan and whether or not you will include personal or official charity in it, push the pause button. There will be plenty of time to provide generous support without putting your own financial security at risk.