<p>Last December,  the Congress passed an extension of the estate tax law. This update will summarize the changes that were adopted.  The exemption from estate taxes was set at $5,000,000 for the years 2011 and 2012.  In 2013, the exemption is reduced to $1,000,000, and decedents dying in 2013 with assets over the exemption are subject to estate taxes.  The top tax rate has been set at 35%.  A significant change was increasing the gift tax exemption to $5,000,000 for 2011 and 2012.  However, complications arise if a person makes a gift of over $1,000,000 and dies in 2013.  It is hoped that the Congress will modify or increase the exemption set to take effect in 2013, but this is far from certain.</p>