S.Amdt. 4194

1. Replaces the bill's text with a full substitute

   Replaces the full textEverything after the enacting clause

   In H.R. 8 · Placed on Calendar Senate

   Struck: SECTION 1. SHORT TITLE.

   Struck: This Act may be cited as the "Death Tax Repeal Permanency Act of 2005".

   Struck: SEC. 2. ESTATE TAX REPEAL MADE PERMANENT.

   Struck: Section 901 of the Economic Growth and Tax Relief Reconciliation Act of 2001 shall not apply to title V of such Act.

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   Struck: Passed the House of Representatives April 13, 2005.

   Inserted: SECTION 1. PERMANENT EXTENSION OF ESTATE TAX AS IN EFFECT IN 2009.

   Inserted: (a) Exclusion Equivalent of Unified Credit Equal to $3,500,000.--Subsection (c) of section 2010 of the Internal Revenue Code of 1986 (relating to unified credit against estate tax) is amended to read as follows:

   Inserted: "(c) Applicable Credit Amount.--

   Inserted: "(1) In general.--For purposes of this section, the applicable credit amount is the amount of the tentative tax which would be determined under section 2001(c) if the sum determined under subsection (b)(1) were equal to the applicable exclusion amount.

   Inserted: "(2) Applicable exclusion amount.--

   Inserted: "(A) In general.--For purposes of this subsection, the applicable exclusion amount is $3,500,000.

   Inserted: "(B) Inflation adjustment.--In the case of any decedent dying in a calendar year after 2010, the dollar amount in subparagraph (A) shall be increased by an amount equal to--

   Inserted: "(i) such dollar amount, multiplied by

   Inserted: "(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting 'calendar year 2009' for 'calendar year 1992' in subparagraph (B) thereof.

   Inserted: If any amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000.".

   Inserted: (b) Maximum Estate Tax Rate Equal to 45 Percent.--Subsection (c) of section 2001 of the Internal Revenue Code of 1986 (relating to imposition and rate of tax) is amended--

   Inserted: (1) by striking "but not over $2,000,000" in the table contained in paragraph (1),

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   Inserted: (2) by striking the last 2 items in such table,

   Inserted: (3) by striking "(1) in general.--", and

   Inserted: (4) by striking paragraph (2).

   Inserted: (c) Modifications of Estate and Gift Taxes To Reflect Differences in Unified Credit Resulting From Different Tax Rates.--

   Inserted: (1) Estate tax.--

   Inserted: (A) In general.--Section 2001(b)(2) of the Internal Revenue Code of 1986 (relating to computation of tax) is amended by striking "if the provisions of subsection (c) (as in effect at the decedent's death)" and inserting "if the modifications described in subsection (g)".

   Inserted: (B) Modifications.--Section 2001 of such Code is amended by adding at the end the following new subsection:

   Inserted: "(g) Modifications to Gift Tax Payable to Reflect Different Tax Rates.--For purposes of applying subsection (b)(2) with respect to 1 or more gifts, the rates of tax under subsection (c) in effect at the decedent's death shall, in lieu of the rates of tax in effect at the time of such gifts, be used both to compute--

   Inserted: "(1) the tax imposed by chapter 12 with respect to such gifts, and

   Inserted: "(2) the credit allowed against such tax under section 2505, including in computing--

   Inserted: "(A) the applicable credit amount under section 2505(a)(1), and

   Inserted: "(B) the sum of the amounts allowed as a credit for all preceding periods under section 2505(a)(2).

   Inserted: For purposes of paragraph (2)(A), the applicable credit amount for any calendar year before 1998 is the amount which would be determined under section 2010(c) if the applicable exclusion amount were the dollar amount under section 6018(a)(1) for such year.".

   Inserted: (2) Gift tax.--Section 2505(a) of such Code (relating to unified credit against gift tax) is amended by adding at the end the following new flush sentence:

   Inserted: "For purposes of applying paragraph (2) for any calendar year, the rates of tax in effect under section 2502(a)(2) for such calendar year shall, in lieu of the rates of tax in effect for preceding calendar periods, be used in determining the amounts allowable as a credit under this section for all preceding calendar periods.".

   Inserted: (d) Effective Date.--The amendments made by this section shall apply to estates of decedents dying, generation-skipping transfers, and gifts made, after December 31, 2009.

   Inserted: (e) Modifications to Estate Tax.--

   Inserted: (1) In general.--Subtitles A and E of title V of the Economic Growth and Tax Relief Reconciliation Act of 2001, and the amendments made by such subtitles, are hereby repealed; and the Internal Revenue Code of 1986 shall be applied as if such subtitles, and amendments, had never been enacted.

   Inserted: (2) Sunset not to apply.--

   Inserted: (A) Subsection (a) of section 901 of the Economic Growth and Tax Relief Reconciliation Act of 2001 is amended by striking "this Act" and all that follows and inserting "this Act (other than title V) shall not apply to taxable, plan, or limitation years beginning after December 31, 2010.".

   Inserted: (B) Subsection (b) of such section 901 is amended by striking ", estates, gifts, and transfers".

   Inserted: (3) Repeal of deadwood.--Sections 2011, 2057, and 2604 of the Internal Revenue Code of 1986 are hereby repealed.

   Original wording

   Strike all after the enacting clause and insert the following:

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As printed