Estate Tax Parameters
2001-2013
| Exemption | Top Tax Rate |
| 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| 2010 | Repealed |
| 2011 | 5,000,000 | 35 |
| 2012 | 5,080,000 | 35 |
| 2013 | 1,000,000 | 55 |
- Under the 2001 tax cut, the estate tax phases out gradually to complete repeal in 2010.
Source: The Estate Tax is Down But Not Out - The Tax Relief, Un-employment Insurance Reauthorization, and Job Creation Act of 2010 set a single rate of 35 percent and a $5 million exemption (indexed for inflation after 2011) for 2011 and 2012. Unless Congress acts to extend the 2010 law, the estate tax will revert to its pre-2001 parameters in 2013.
Source: Wealth Transfer Taxes: How do the estate, gift, and generation-skipping taxes work? - Estates larger than $5 million potentially owe estate tax in 2011. Only about 1 in 800 deaths will result in a taxable estate; 99.9 percent of deaths trigger no estate tax. The estate tax will raise over $10 billion from 3,300 deaths in 2011.
Source: Tax Policy Center Table T11-0156 - The estate tax is the most progressive federal tax. In 2011, over 90 percent of estate taxpayers will come from the top 10 percent of the income distribution while nearly half will come from the top 1 percent. These groups pay 98 and 79 percent of estate tax revenue, respectively. Estates of people in the top 0.1 percent of the income distribution will pay more than half of all estate taxes.
Source: Wealth Transfer Taxes: Who pays the estate tax?
- Compared to current law, extending the 2011 estate tax law and indexing it for inflation would reduce estate tax revenue by about $325 billion from 2011 to 2020,. Current law returns the exemption to $1 million and the top rate to 55 percent in 2013.
Source: Tax Policy Center Table T11-0156
For more on the estate tax, see:
It's Not About Economic Equality, Roberton Williams, December 17, 2010
Where, Oh Where Has the Estate Tax Gone? Roberton Williams, December 23, 2009
Back from the Grave: Revenue and Distributional Effects of Reforming the Federal Estate Tax, Leonard E. Burman, Katherine Lim, Jeff Rohaly, October 20, 2008
Estate Tax Reform: A Third Option, C. Eugene Steuerle, July 18, 2005.
Options to Reform the Estate Tax, Leonard E. Burman, William G. Gale and Jeff Rohaly, March 23, 2005.
Effects of Estate Tax Reform on Charitable Giving, by Jon M. Bakija and William G. Gale, July 10, 2003.
The Estate Tax Is Down, But Not Out, by Leonard E. Burman and William G. Gale, December 1, 2001.
Tables:
See all publications related to Estate and Gift Taxes.
See all estimates related to Estate and Gift Taxes.
See all tax facts (background data) related to Estate and Gift Taxes.
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