Most of you reading this are aware that since January 1, 2010 there is no federal estate tax. Some states continue to have an estate tax while the majority of states are coupled with the federal government and therefore do not have an estate tax.

Dan Duncan made an incredible amount of money as a gas pipeline mogul. He lived in Houston and when he died on March 28, 2010 his estate was estimated to be 9 billion dollars.

Many people with his net worth have done at least some estate planning – generally a little more than the traditional revocable living trust and will. Even if he did not do comprehensive estate planning permitting his family to retain the vast majority of the estate, he may have left a lot of his money to a foundation like Warren Buffet and Bill Gates are doing.

However, it is likely that the federal treasury will lose out on a lot of money. In the event that he had not done estate planning, Mr. Duncan’s estate would have had to pay somewhere in the neighborhood of $4 billion in taxes.

Now, it may not be a total loss to the federal treasury. There may be capital gains taxes that will have to be paid because of the loss of a step up in basis. I do not know the composition of Mr. Duncan’s estate.

Nevertheless, I expect that the result of Mr. Duncan’s death has people in Congress talking. Mr. Duncan’s death may have huge effects on most of us who are simply concerned with living trusts and the avoidance of probate.