Congress is considering reforming (permanently, this time) the confusing federal estate-tax law. But don't wait for Congress to act before revisiting your personal estate plan. Changes already scheduled to take effect at year-end hasten the need to dust off your family's estate plan later this year, regardless of Congress's actions.
Here's what's happening: Under President Bush's first big tax cut law in 2001, the top federal estate-tax rate was set along a path to decline gradually from 55 to 45 percent in 2009. At the same time, the estate-tax exemption level—the amount of your estate that you can shelter from estate taxes—is rising from $675,000 in 2001 to $3.5 million in 2009. (The 2005 exemption level is $1.5 million, jumping to $2 million next year.)
The federal estate tax is scheduled to disappear completely in 2010. But only for one year. Because of the law's "sunset" provision, estate taxes come roaring ba...(register to read more)