Once the value of the "gross estate" is determined, the law provides for various "deductions" (in Part IV of Subchapter A of Chapter 11 of Subtitle B of the Internal Revenue Code) in arriving at the value of the "taxable estate." Deductions include but are not limited to: Of these deductions, the most important is the deduction for property passing to (or in certain kinds of trust, for) the surviving spouse, because it can eliminate any federal estate tax for a married decedent. The tentative tax is based on the tentative tax base, which is the sum of the taxable estate and the "adjusted taxable gifts" (i.e., taxable gifts made after 1976). According to the Economic Growth and Tax Relief Reconciliation Act of 2001, the applicable exclusion increased to $3,500,000 in 2009, and the estate tax was repealed for estates of decedents dying in 2010, but then the Act was to "sunset" in 2011 and the estate tax was to reappear with an applicable exclusion amount of only $1,000,000.
However, this unlimited deduction does not apply if the surviving spouse (not the decedent) is not a U. For decedents dying after December 31, 2009, the tentative tax will, with exceptions, be calculated by applying the following tax rates: --Internal Revenue Code section 2001(c), as amended by section 302(a)(2) of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (H. The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 became law on December 17, 2010.
The other part of the system, the gift tax, applies to transfers of property during a person's life.
In addition to the federal estate tax, many states have enacted similar taxes.
To these interests are added the following property interests generally not owned by the decedent at the time of death: The above list of modifications is not comprehensive. 17, 2010), as amended by section 101(c)(1) of the American Taxpayer Relief Act of 2012; see "Instructions for Form 706 (Rev.