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No federal estate tax in 2010 could result in accidental disinheritance

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The U.S. Congress did not address the federal estate tax before the end of 2009, which means that provisions in the law, The Economic Growth and Tax Relief Reconciliation Act of 2001, control federal estate taxation in 2010 unless Congress makes changes later this year. The 2001 act provided that there is no federal estate tax in 2010.

In the past one common estate planning model gave the assets that could pass estate tax free — an unlimited amount in 2010 — to benefit one person or one group of heirs (Heir 1). The amount that would be subject to federal estate tax was treated differently and often passed to other heirs (Heir 2). If a person with this model in his or her estate planning documents dies in 2010 and there is no federal estate tax, it is possible that Heir 1 would receive everything and Heir 2 would receive nothing.

This is a good time to review your estate planning documents with your professional adviser to avoid accidentally disinheriting one or more of the people or charitable organizations you want to benefit. If you have included a gift to The University of Texas at Austin from your estate or would like to leave a gift, please contact the Gift Planning team for suggested language and to be sure that the University can use your gift as you direct. You can contact the team at

E-mail: giftplan@www.utexas.edu

Web: giving.utexas.edu/giftplanning

IRS Circular 230 Notice: The University of Texas at Austin does not provide legal, tax, or financial advice. Consequently we urge you to seek the advice of your own legal, tax, or financial professionals in connection with gift and planning matters. This information is not intended to be used and cannot be used for the purpose of avoiding tax-related penalties.