Half Sigma points out:
The wise members of Congress have determined that the estate tax will be 45% in 2009, 0% in 2010, and then 55/60% in 2011 and years after. Clearly, the best year to die is 2010. By dying in 2010 a rich person essentially doubles the amount of money his heirs will receive.
I predict that there will be a mysterious increase in deaths among the very wealthy in 2010.
A reader notes this abstract:
Dying to Save Taxes: Evidence from Estate Tax Returns on the Death Elasticity
"This paper examines data from U.S. federal tax returns to shed light on whether the timing of death is responsive to its tax consequences. We investigate the temporal pattern of deaths around the time of changes in the estate tax system periods when living longer, or dying sooner, could significantly affect estate tax liability. We find some evidence that there is a small death elasticity, although we cannot rule out that what we have uncovered is ex post doctoring of the reported date of death."
But, I bet the timing advantages of Grandma kicking off by 12/31 have never been as huge as they will be in 2010.