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U.S./world – Death tax to end – $138B cost

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Congress has approved a gradual elimination of the estate tax.

The $1.35 trillion, 10-year package of tax cuts approved by lawmakers May 26 generally cuts the highest estate-tax rate from the current rate of 55 percent to 50 percent in 2002, and 45 percent in 2007, The Wall Street Journal reported May 29.

Lawmakers also voted to raise the exemption to $3.5 million in 2009 from $1 million in 2002 before repealing the estate tax and imposing capital-gains taxes on many types of inherited assets in 2010, the Journal said.

The minimum exclusion in 2010 would be $1.3 million, plus $3 million more for transfers to a surviving spouse.

The measure keeps the gift tax starting in 2010, with a $1 million lifetime exclusion and gift-tax rates set at the highest income-tax level, the Journal said.

The pricetag for the estate-tax measure is $138 billion, the Journal said.

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