Morningstar on the future of the estate tax

Morningstar has a good article about the future of the estate tax.  Here are some excerpts.

Sens. Blanche Lincoln, D-Ark., and Jon Kyl, R-Ariz., are making a bipartisan effort to reinstate the estate tax at a 35% rate, with an eventual exemption of $5 million. Any legislative attempt to renew George W. Bush's tax cuts for the middle class might also include an estate-tax modification along similar lines.

As 2010 draws to a close, however, it is increasingly likely that Congressional inaction will produce another scenario that no one would have anticipated just a year ago: The estate tax will revert to the hefty 2001 rate of 55%, with a mere $1 million exemption.

"Common sense would suggest that it is not likely, but the repeated inability of Congress to act and make a decision gives me pause," says Thomas Abendroth, an estate attorney with Schiff Hardin in Chicago. "You have to contemplate that there is a decent chance they may not get anything done before next year."