History

• Prior to 2001, all estates in United States were taxed at a rate of 55 percent. However, the tax included an exemption for the first $675,000 of the estate's value. For example, an estate valued at $1,000,000 would pay a tax of $178,750 ($1,000,000 - $675,000) x .55.
  
  

Eligibility

• Between the years 2002 and 2009, the estate tax, while applicable to everyone, changed yearly in both its rate and the size of its exemption. The tax ranged from 50 percent with a $1 million exemption in 2002 to 45 percent with a $3.5 million exemption in 2009. In 2010, the estate tax was repealed for a single year.
  
  

Future

• As of September 2010, Congress has not yet passed an extension of the previous modification to the estate tax. Without new legislation, rates roughly equivalent to those that applied before 2002 would return in 2011. Estates would be exempt for up to $1 million, with the remainder taxed at 55 percent.