S. 3533, 111th Cong., 2d Sess. (June 23, 2010), the “Responsible Estate Tax Act of 2010,” introduced by Senators Bernard Sanders (I-Vermont), Tom Harkin (D-Iowa) and Sheldon Whitehouse (D-R.I.), would:
- Retroactively reimpose the estate tax and GST tax;
- Adopt an applicable exclusion amount and GST exemption of $3.5 million per person;
- Adopt a progressive rate structure, under which a 45% rate would apply on the taxable estate up to $10 million, 50% on the taxable estate above $10 million and below $50 million, and 55% on taxable estates above $50 million, and a 10% surtax on estates above $500 million;
- Enact two loophole closures included in President Obama’s Fiscal Year 2011 budget, requiring consistent valuation for transfer and income tax purposes, and requiring a 10-year minimum term for GRATs;
- Eliminate the use of valuation discounts for entities that do not operate an active trade or business;
- Allow reduction in the gross estate under Code Sec. 2032A , special use valuation for family farms and certain closely held business real estate, by up to $3 million; and
- Expand the rules for conservation easements through increasing the maximum exclusion amount to $2 million and increasing the base percentage to 60%.
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