Many tax changes went into effect on January 1st of this year and additional changes are guaranteed in 2009 as Congress attempts to stimulate the economy with tax cuts.

The following are some changes to the estate and gift taxes in effect for 2009 under current law:

Estate tax: Far fewer estates will be subject to federal and state tax this year. The estate tax exemption jumped to $3.5 million up from $2 million in 2008. Amounts above the exemption will continue to be taxed at a flat 45%.

Gift tax: the annual gift tax exclusion rose to $13,000 per gift this year, an increase of $1000 over the 2008 level. The lifetime gift tax exemption did not change and remains at $1 million.