Stephen B. Jordan, EA: Federal Estate Tax Exemption & Rate: 1997

Tuesday, July 31, 2012

Federal Estate Tax Exemption & Rate: 1997 - 2013

Federal Estate Tax Exemption & Rate: 1997 - 2013
Table Showing Federal Estate Tax Exemption and Rate: 1997 - 2013
Source: Julie Garber, About.com Guide

The exemption from federal estate taxes has increased significantly since 1997 while the estate tax rate has significantly decreased. Below is a chart that shows the changes in the estate tax exemption and estate tax rate from 1997 through 2013.

Tax years 2010 through 2012 are based on the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act ("TRA 2010") that was signed into law by President Obama on December 17, 2010. This law is only good for two years and so will sunset on December 31, 2012, meaning that on January 1, 2013, the federal estate tax exemption and rate will default to the numbers that were in effect in 2001/2002.

**TRA 2010 provides that the estate tax exemption, lifetime gift tax exemption, and generation-skipping transfer tax exemption will be indexed for inflation in 2012, hence the $120,000 increase in the 2012 estate tax exemption.

Historical and Future Federal Estate Tax Exemptions and Rates

Year	Estate Tax Exemption	Top Estate Tax Rate
1997	$600,000	55%
1998	$625,000	55%
1999	$650,000	55%
2000	$675,000	55%
2001	$675,000	55%
2002	$1,000,000	50%
2003	$1,000,000	49%
2004	$1,500,000	48%
2005	$1,500,000	47%
2006	$2,000,000	46%
2007	$2,000,000	45%
2008	$2,000,000	45%
2009	$3,500,000	45%
*2010	$5,000,000 or $0	35% or 0%
2011	$5,000,000	35%
**2012	$5,120,000	35%
2013	$1,000,000	55%