Death tax repeal gets new life

death tax - the Grim Reaper
death tax - the Grim Reaper

When the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA 2001) was signed into law by President Bush, many expected that years of fighting over a permanent repeal of the federal estate tax would finally be over. Under EGTRRA 2001, the personal exemption available under the estate tax increased to $3.5 million in 2009 with a temporary repeal for 2010. The expectation was that some form of compromise bill would take effect, boosting the personal exemption to between $3.5 million and $5 million. That didn't happen.

Just four years after EGTRRA 2001 passed, the idea of complete repeal was back in the news. Majority Leader Sen. Bill Frist (R-Tenn.) was at the forefront of the movement, arguing that the federal estate tax destroyed small businesses. In a dramatic speech on the Senate floor, he argued:

If you are an enterprising entrepreneur who has worked hard to grow a family business or to keep and maintain that family farm, your spouse and children can expect to hear the knock of the tax man right after the Grim Reaper.