inserting after subsection (a) the following new sub-
section:
‘‘(b) COMPUTATION OF TAX.—The tax imposed by
this section shall be the amount equal to the excess (if
any) of—
‘‘(1) 30 percent of the sum of—
‘‘(A) the amount of the taxable estate, and
‘‘(B) the amount of the adjusted taxable
gifts, over
‘‘(2) the aggregate amount of tax paid under
chapter 12 with respect to gifts made by the dece-
dent after December 31, 1976.
For purposes of paragraph (1)(B), the term ‘adjusted tax-
able gifts’ means the total amount of the taxable gifts
(within the meaning of section 2503) made by the dece-
dent after December 31, 1976, other than gifts which are
includible in the gross estate of the decedent.’’
(2) CONFORMING AMENDMENTS.—
(A) Subsection (b) of section 2101 of such
Code is amended to read as follows:
‘‘(b) COMPUTATION OF TAX.—The tax imposed by
this section shall be the amount equal to the excess (if
any) of—
‘‘(1) 30 percent of the sum of—
‘‘(A) the amount of the taxable estate, and
‘‘(B) the amount of the adjusted taxable
gifts, over
‘‘(2) the aggregate amount of tax paid under
chapter 12 with respect to gifts made by the dece-
dent after December 31, 1976.’’
(B) Subsection (c) of section 2102 of such
Code is amended—
(i) by striking ‘‘$13,000’’ each place it
appears and inserting ‘‘$20,000’’, and
‘‘(ii) by striking ‘‘$46,800’’ and in-
serting ‘‘$52,500’’.
(b) GIFT TAX.—
(1) IN GENERAL.—Section 2502 of such Code
is amended to read as follows:
‘‘SEC. 2502. RATE OF TAX.
‘‘(a) GENERAL RULE.—The tax imposed by section
2501 for each calendar year shall be an amount equal to
30 percent of the sum of the taxable gifts for such cal-
endar year.’’
‘‘(b) TAX TO BE PAID BY DONOR.—The tax imposed
by section 2501 shall be paid by the donor.’’
(2) CONFORMING AMENDMENTS.—
(A) Subchapter A of chapter 12 of such
Code is amended by striking section 2504.
(B) The table of sections for such sub-
chapter is amended by striking the item relat-
ing to section 2504.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to estates of decedents dying, and
gifts made, after the date of the enactment of this Act.
SEC. 2. UNIFIED CREDIT INCREASED TO EQUIVALENT OF
$10,000,000 EXCLUSION; INFLATION ADJUST-
MENT OF UNIFIED CREDIT.
(a) IN GENERAL.—Subsection (c) of section 2010 of
the Internal Revenue Code of 1986 (relating to applicable
credit amount) is amended by striking all that follows
‘‘were the applicable exclusion amount’’ and inserting ‘‘.
For purposes of the preceding sentence, the applicable ex-
clusion amount is $10,000,000.’’
(b) INFLATION ADJUSTMENT.—Section 2010 of such
Code is amended by redesignating subsection (d) as sub-
section (e) and by inserting after subsection (c) the fol-
lowing new subsection:
‘‘(d) COST-OF-LIVING ADJUSTMENT.—In the case of
any decedent dying, and gift made, in a calendar year
after 2001, the $10,000,000 amount set forth in sub-
section (c) shall be increased by an amount equal to—
‘‘(1) $10,000,000, multiplied by
‘‘(2) the cost-of-living adjustment determined
under section 1(f)(3) for such calendar year by sub-
stituting ‘calendar year 2000’ for ‘calendar year
1992’ in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence
is not a multiple of $10,000, such amount shall be round-
ed to the nearest multiple of $10,000.’’
(c) CONFORMING AMENDMENT.—Subparagraph (A)
of section 2057(a)(3) of such Code is amended by striking
‘‘$625,000’’ and inserting ‘‘the excess of the applicable ex-
clusion amount (determined without regard to this para-
graph) over $675,000’’.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to estates of decedents dying, and
gifts made, after the date of the enactment of this Act.
SEC. 3. ANNUAL GIFT TAX EXCLUSION INCREASED TO
$50,000.
(a) IN GENERAL.—Subsection (b) of section 2503 of
the Internal Revenue Code of 1986 (relating to exclusion
from gifts) is amended by striking ‘‘$10,000’’ each place
it appears and inserting ‘‘$50,000’’.
(b) CONFORMING AMENDMENT.—Paragraph (2) of
section 2503(b) of such Code is amended—
(1) by striking ‘‘1998’’ and inserting ‘‘2001’’,
and
(2) by striking ‘‘1997’’ and inserting ‘‘2000’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to gifts made after December 31,
2000.
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