On Dec. 17, President Obama enacted tax legislation that extended the Bush-era tax cuts, which were due to expire Jan. 1. The legislation contains provisions for estate, gift and generation skipping transfer (GST) taxes (collectively, the Transfer Taxes), including an option for 2010 decedents. This article is not meant to provide a detailed analysis of the new law. Rather, it points out some of the key Transfer Tax provisions and how they can affect your clients’ planning.
It is important to note that the new law is temporary. Unless Congress acts before Jan. 1, 2013, the Transfer Tax exemptions and tax rates will revert to what they were in 2001. For example, the federal estate tax exemption will return to $1 million per person, with a maximum rate of 55 percent in 2013.
