Estate tax - Overview
Answer:
If Congress does not agree by the end of 2012, the estate tax is set to revert to pre-2001 levels. As of this date, estate tax rates for 2013 and beyond are set to increase to a maximum of 55% (up from 35% in 2011 and 2012), and only the first $1 million of one’s estate (down from $5.12 million in 2012 and $5 million in 2011) would be exempt.
New for 2011 and 2012 is a concept named portability which allows a surviving spouse's estate to use any portion of the exemption amount not used by the other spouse’s estate.
For decedents and gifts made in the current year, a unified credit of $1,730,800 is allowed which is the equivalent of a $5,120,000 dollar exemption is subtracted from the tax calculated on the taxable estate.
New for 2011 and 2012 is a concept named portability which allows a surviving spouse's estate to use any portion of the exemption amount not used by the other spouse’s estate.
For decedents and gifts made in the current year, a unified credit of $1,730,800 is allowed which is the equivalent of a $5,120,000 dollar exemption is subtracted from the tax calculated on the taxable estate.
