I often joke about the fact that if you have are going to have your rich relative die you want them to die in 2010. The reason behind this is there is no estate tax that year and that year only. What may not end up being funny is that some people may actually act on it. I have a feeling some crazy is going to kill a relative just to avoid taxes. You heard it here first. It WILL happen (no not by me if that’s what you’re reading into this) . I have a better way to handle estate tax planning and that is get a good lawyer. Unfortunately everything is up to the person leaving the money and we all hope they live a good long time but when they do go your money goes to a good cause, you. Here’s a chart with the past, present, and future estate tax exemptions and rate limits.

Estate-Tax Phaseout

The federal government’s tax window closes over the next decade as the top estate-tax rate drops and the amount each person can pass free of federal estate taxes increases. The tax expires in 2010 only to drop down in $1 million

Calendar year Exemption Highest rate
2002 $1 million 50%
2003 1 million 49
2004 1.5 million 48
2005 1.5 million 47
2006 2 million 46
2007 2 million 45
2008 2 million 45
2009 3.5 million 45
2010 repealled 0
2011 1 million