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2001 Tax Act
Estate Planning Changes of the 2001 Tax Act
Reduction in Rates and Increases in Exemption
Calendar Year
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Estate and GST Tax
Exemption
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Gift Tax Exemption
|
Highest Estate, Gift and GST Tax Rate |
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2002
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$1 million
|
$1 million
|
50%
|
|
2003
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$1 million
|
$1 million
|
49%
|
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2004
|
$1.5 million
|
$1 million
|
48%
|
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2005
|
$1.5 million
|
$1 million
|
47%
|
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2006
|
$2 million
|
$1 million
|
46%
|
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2007
|
$2 million
|
$1 million
|
45%
|
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2008
|
$2 million
|
$1 million
|
45%
|
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2009
|
$3.5 million
|
$1 million
|
45%
|
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2010
|
(Taxes Repealed)
|
$1 million
|
35%
|
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After 2010
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$1 million
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$1 million
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55%
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NOTE:
UNLESS CONGRESS ACTS BEFORE THE YEAR 2011, THE REPEAL WILL SUNSET AND WE WILL RETURN TO THE LAW AS IT IS IN 2002.
Other Changes
- Retention of the Gift Tax
- In the year 2010, we will have modified carryover basis for assets.
- The executor of an estate can add $1.3 million to the decedent's basis but not in excess of its fair market value on the date of death.
- Capital losses may be carried over.
- The basis of qualified spousal property may be increased by an additional $3 million.
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