New year begins with no estate tax

The unthinkable happened in 2009. Our political leaders failed to extend the current estate tax laws. For 2010, there is no estate tax or generation skipping tax (GST) in effect. The estate tax law in 2009 exempted up to $3.5 million per individual from taxation and imposed a top rate of 45 percent. However, for persons who die after 2010, the estate tax law comes back into effect with a vengeance -- exempting only $1 million in assets from tax and imposing a maximum tax rate of 55 percent. The new tax laws in 2011 could affect up to an estimated 70,000 estates, compared with the 2009 laws, which applied to about 5,500 estates annually.