Major Estate Planning Implications of the Taxpayer Relief Act of 1997

Brody, Lawrence
October 1997
Journal of Financial Planning;Oct97, Vol. 10 Issue 5, p40
Academic Journal
The article focuses on the estate planning and transfer tax provisions of the Taxpayer Relief Act of 1997 in the U.S. Some of the major provisions of the act that affect transfer tax planning, as well as some initial planning thoughts are as following: The unified credit is increased over nine years from the current exemption equivalent amount of $600,000 to $1 million in 2006; The $1 million generation-skipping transfer tax exemption is indexed for inflation for individuals who die after 1998, rounded to the next lowest multiple of $10,000; For gifts made in calendar years after the date of enactment, a gift disclosed on a gift tax return for which the limitations period has passed cannot he re-valued for purposes of determining the applicable estate tax bracket and available unified credit. Only returns where gift tax was paid are subject to this new rule and a transfer from a revocable trust would be treated as if made directly by the grantor, reversing prior Internal Revenue Service authority that those transfers made within three years of death were includible in the grantor's gross estate for estate tax purposes.


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