5-YEAR EXTENSION OF EXISTING RATES; PHASEOUT OF BENEFITS OF EXISTING RATES AND UNIFIED CREDIT.

SEC. 10401. 5-YEAR EXTENSION OF EXISTING RATES; PHASEOUT OF BENEFITS OF EXISTING RATES AND UNIFIED CREDIT. (a) 5-Year Extension of Graduated Rates.— Paragraph (2) of section 2001(c) (relating to phasein of 50 percent maximum rate) is amended— (1) by striking out “1988” in subparagraph (A) and inserting in lieu thereof ‘T993”, (2) by striking out “in 1984, 1985, 1986, or 1987” in the text of subparagraph (D) and inserting in lieu thereof “after 1983 and before 1993”, and (3) by amending the heading of subparagraph (D) to read as follows: “(D) After 1983 and before 1993.—”. (b) Phaseout of Benefits of Graduated Rates and Unified Credit.— (1) In general.— Subsection (c) of section 2001 is amended by adding at the end thereof the following new paragraph: “(3) Phaseout of graduated rates and unified credit.— The tentative tax determined under paragraph (1) shall be increased by an amount equal to 5 percent of so much of the amount (with 101 STAT. 1330–431respect to which the tentative tax is to be computed) as exceeds $10,000,000 but does not exceed $21,040,000 ($18,340,000 in the case of decedents dying, and gifts made, after 1992).” (2) Technical amendments — (A) Subsection (b) of section 2001 is amended— (i) by striking out “in accordance with the rate schedule set forth in subsection (c)” in paragraph (1) and inserting in lieu thereof “under subsection (c)”, and (ii) by striking out “the rate schedule set forth in subsection (c) (as in effect at the decedent’s death)” in paragraph (2) and inserting in lieu thereof “the provisions of subsection (c) (as in effect at the decedent’s death)”. (B) Subsection (a) of section 2502 is amended— (i) by striking out “in accordance with the rate schedule set forth in section 2001(c)” in paragraph (1) and inserting in lieu thereof “under section 2001(c)”, and (ii) by striking out “in accordance with such rate schedule” in paragraph (2) and inserting in lieu thereof “under such section”. (c) Effective Date.— The amendments made by this section shall apply in the case of decedents dying, and gifts made, after December 31, 1987.