It's unlikely the one-year estate tax repeal in 2010 will occur. Proposed legislation retains the $3.5 million estate tax exemption and top 45% rate. It also reunifies the estate and gift tax exemptions and allows a surviving spouse to use a deceased spouse's unused exemption.
The Obama administration has proposed a change in estate and gift tax valuations for the same asset. Currently, you may use a high valuation for gift tax purposes but a lower value for inherited assets. Net effect: Income tax is reduced when the asset is later sold, due to basis adjustment. Under the new Obama proposal, the same value must be used for both purposes.