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From President Obama —
Estate Tax Relief Law Signed

President Obama signed into law the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (the “2010 Tax Relief Act”). This law enacts the framework agreed to by President Obama and Senate Republican leaders. It extends Bush-era tax cuts for individuals, provides payroll tax relief for 2011, reflects a temporary estate tax compromise, and for business extends tax incentives and enacts new tax breaks. Without Congressional action, the estate tax would have returned in 2011 (following a one-year repeal). The 2010 Tax Relief Act restores the Federal Estate Tax (retroactive to the beginning of 2010), reduces the top rate to 35% (versus 55%) and increases the exemption to $5 million. The provision is scheduled to expire at the end of 2012. In addition, the Federal Gift Tax exception has increased to $5 million (from $ 1million). This increase should give tax payers a significant estate planning opportunity.
HM&M would like to encourage you to meet with your advisors to discuss how the estate tax changes affect your estate and family.