With the fiscal cliff looming, the House and Senate have each put forward tax bills that are designed to hold off some of the tax increases that will go into effect on January 1, 2013. However, the Democrats and Republicans continue to battle over increased tax rates and government spending levels.
The estate tax is not addressed in the Senate bill. As a result, the exclusion amount would go to $1 million, and the tax rate for amounts over $1 million will increase to 55%.
The estate tax provision in the House bill proposes extending the current provisions through 2013. That means an exclusion amount of $5.12 million, and a tax rate of 35% for amounts over the exclusion.