minimum tax designed to ensure that taxpayers pay at least 30% on their adjusted gross income (AGI) (a credit for charitable contributions would be allowed). Translated, this means that if the taxpayer’s “regular” taxes (including certain credits, the alternative minimum tax and the new 3.8% surtax on net investment income) and payroll taxes didn’t reach 30%, the FST would make up the difference. The FST would be phased in starting at $1 million of AGI, and would be fully phased in at $2 million of AGI (these thresholds would be indexed for inflation as of 2015). Comments. Taxpayers who already pay an aggregate 30% in regular and payroll taxes would not be subject to the FST — but those who chiefly have income from qualified dividends and long-term capital gains (and therefore have lower than a 30% effective rate) would see a significant tax increase. e Restore the 2009 transfer tax parameters. Beginning in 2018, the transfer tax provisions that were in effect in 2009 would be restored. The top transfer tax rate would thus be 45% instead of 40%; the estate tax exclusion and generation-skipping transfer tax (GST) exemption would be $3.5 million, and the gift tax exclusion would be $1 million (these amounts would not be indexed for inflation). In computing gift or estate tax liability with respect to these reduced exclusions, taxpayers would not be affected by “clawback.” That is, they wouldn't be subject to additional tax if they had taken advantage of the previous (higher) exclusion amounts (in 2013, the applicable exclusion amount (AEA) against gift and estate tax is $5.25 million, and is indexed for inflation; the GST exemption equals the AEA). “Portability,” which allows a surviving spouse to effectively “inherit” the deceased spouse’s unused AEA, would continue. Comments. Despite President Obama's urging to the contrary, the American Taxpayer Relief Act of 2012 (ATRA), enacted on January 2, 2013, made permanent most of the transfer tax provisions that were in