This bill would permanently eliminate the federal estate tax and generation-skipping transfer tax for individuals who die after the bill is enacted, allowing wealthy families to pass their full estates to heirs without these taxes. The legislation would also modify the gift tax by establishing a new tax rate schedule (ranging from 18 to 35 percent on gifts) and setting a $10 million lifetime gift exemption that adjusts annually for inflation. The bill affects primarily high-net-worth individuals and families, as the estate and generation-skipping taxes currently only apply to estates exceeding certain thresholds (which are set to decrease significantly after 2025 under current law). No new funding is established since the bill reduces federal revenue rather than allocating resources. The changes would take effect immediately upon enactment, though the legislation includes a transition rule treating the year of enactment as two separate periods for tax calculation purposes.
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