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All major tax law revisions provide planning possibilities, as well as perils. The Taxpayer Relief Act of 1997 is no exception. While it will take some time for the full impact of this Act to be understood and interpreted, there are significant changes in estate planning meriting immediate consideration and a re-thinking of strategies for the months and years ahead.
The new provisions are complex, and this article briefly underscores the practical considerations of a few of the changes significant to individuals and the tax and estate planning professionals who advise them.
* A higher Unified Credit Exemption Equivalent will be phased in from 1998 to 2006, increasing the amount of assets each individual can transfer free of gift or estate tax from the current $600,000 to $1,000,000 by 2006. The major annual increases occur after 2003.
Practical Planning Considerations: For some individuals and couples on the "borderline" …