The expiration of the estate tax has been met with much fanfare, but it doesn't come without it's share of complications as well. Such is the case with any changes I guess.

Some people will need to look over their wills to make sure that the amount that passes to their spouse is not tied to the estate tax exemption. With no estate tax exemption this year, you could be leaving your spouse empty handed if something happens to you. This is a planning tool to avoid estate taxes that may end up backfiring on a few people.

Another issue is the bumped up basis in an asset that you inherit. This is a huge timesaver for inherited property, becuase it is much easier to look up the price of a stock on a date of death than to go back through years of purchase records and reinvestment activity to determine a stocks original basis. Well with the expiration of the estate tax, the bumped up basis is also being threatened. What is a boon to a few (who actually faced an estate tax), is going to become a headache to the multitude (who received the benefit of the bumped up basis they inherit).

And since most see this is a temporary status until they agree to the terms of a new estate tax (or just let the current terms expire next year), it will create a year of exceptions to the otherwise well known rules.

Here is an article that explains the pros and cons of these changes well, as well as who is likely to benefit and who will pay more under the new law.

Wikipedia offers some insight quoted below on the ability to still receive some stepped up basis even under this new law (up to 1.3 million per estate), but it is not as cut and dry as the older rules.

"If the law does not change, for 2010 property transferred from decedents will be treated as if it is transferred by gift. This means the basis of the property for calculating capital gains when the recipient eventually sells the property will be the same basis as in the hands of the decedent. This is generally called carryover basis. However most recipients will effectively get the same result they would receive under present law, because section 1022 allows the executor of an estate to allocate up to 1.3 million in basis for singles and 3 million for surviving spouses to the property of the estate. This will effectively give most recipients a tax basis in the property equal to the full market value ie. "step up basis". See 26 U.S.C. § 1022."

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