Question: The Economic Growth and Tax Relief Reconciliation Act of 2001
The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) lowered the top marginal rate for estate taxation, called for a gradual increase in the estate tax exemption (the amount of an estate that is untaxed) to $3.5 million, and called for a complete elimination of the tax in 2010. However, a sunset provision in the law implies that the estate tax will reappear again in 2011, with an exemption of only $1 million and at a higher marginal rate. How should this sunset provision affect the savings and charitable giving rates of the elderly prior to 2011 and subsequent to 2011?
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