An estate tax return for a U.S. citizen or resident needs to be filed only if the gross estate exceeds the applicable exclusion amount for the year of death, listed below.

The annual exclusion for gifts made to spouses who are not U.S. citizens increased to $114,000.

For estates of decedents dying, and gifts made, after 2003, the maximum rate for the estate tax and the gift tax is as follows.

For estate of decedents dying in 2004, the credit allowed for state death taxes is limited to 25% of the amount that would otherwise be allowed.

The generation-skipping transfer (GST) lifetime exemption increased to $1,500,000. The annual increase can only be allocated to transfers made during or after the year of the increase.

The qualified family-owned business interest deduction has been repealed for the estates of decedents dying after December 31, 2003.

For estates of decedents dying after 2004, the credit for state death taxes will be replaced with a deduction for state death taxes.