There is currently no federal estate tax or Generation-Skipping Transfer (“GST”) tax for persons dying in 2010. Additionally, only a limited income tax basis step-up of assets held at death exists, resulting in possible unexpected capital gains tax and a need for professional decision-making. Thereafter, in 2011, the federal estate tax reapplies with a $1-million exemption and a 55 percent marginal tax rate. The basis of assets is then stepped up to fair market value. Retroactive legislation in 2010 could re-enact the tax this year, and the $1-million exemption scheduled in 2011 will likely be increased, creating difficulties in planning and administering estates.