Nine years ago Congress provided for a gradual phase out of Federal Estate Taxes. The idea was to increase the estate tax exemption from the $1,000,000 available at the time the law passed to 3,500,000 in 2009, and to create an unlimited exemption, so that estate taxes would disappear in 2010.
The problem is that congress wanted to tell their constituents that the change would not cost the government any revenue, and in order to fall within the voodoo economics formula, which Congress follows in making such claims, our lawmakers included a sunset provision that would kick in after 10 years. In other words in 2011 the estate tax would return to the time space continuum from which it sprang, and the exemption would decrease to $1,000,000 amount that existed before Congress passed the law.
At the time everyone assumed that Congress would make the abolition of estate taxes permanent long before the sunset provision would take affect. However, as of September 2010 Congress has still done nothing, and the Federal Estate Tax burden is scheduled to jump for anyone dying on or after January 1, 2011
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