After a year of debate and confusion over the fate of the federal estate tax, year 2010 ended with Congress finally voting to keep the federal estate, gift and generation-skipping transfer (“GST”) tax exemptions at $5 million each . . . temporarily. The 2010 single year of repeal saw the deaths of no fewer than five billionaires, potentially costing the government billions of dollars in estate tax revenue.

Still, Congress was unable to agree on permanent reform and, unless Congress takes further action, the federal estate tax and gift tax exemptions are to reset in year 2013 at $1 million each, and the GST tax exemption will reset at $1 million (indexed for inflation). The top estate, gift and GST tax rates all will be reset at 55% (with a 5% surcharge on the estate tax for very large estates).