Has recent “tax reform” eliminated the federal estate (“death”) tax?
Estate, gift, and generation-skipping taxes are part of a uniform transfer tax system. The estate and gift tax share a progressive rate schedule and a unified credit (now called an “applicable exclusion amount”). The Economic Growth and Tax Relief Reconciliation Act of 2001 (“Tax Relief Act”) made significant changes to the estate and gift tax system. Note: all provisions of the Tax Relief Act “sunset” on December 31, 2010. Consequently, on January 1, 2011, unless further changes are made (which many commentators believe is a certainty) the gift, estate and generation-skipping transfer tax laws revert back to the pre-2001 Tax Relief Act laws. The Tax Relief Act eliminates the federal estate tax for deaths occurring during the year 2010. Estate tax rates for deaths occurring during the years 2002 through 2009 are reduced; the highest estate tax rate drops to 50% for decedents dying, and gifts in 2002; 49% in 2003; 48% in 2004; 47% in 2005; 46% in 2006 and 45% for 2007, 2008 and 2009. Be
