In 1997, Congress added a special exemption for family-owned businesses allowing up to $1,300,000 to be transferred without federal estate tax to the extent the assets of the estate were family-owned business property. It required that at least 50 percent of the decedent’s estate consist of qualified family-owned business interests. If a couple planned to take advantage of this provision, they could avoid paying federal estate taxes on estates totaling $2.6 million. To qualify, decedent or a member of his or her family had to own the business for at least 5 years of the 8 years preceding his death and during that time, material participation by decedent or a member of his family in the business operation was required. The excess amount above the exemption equivalent amount will be subtracted in computing the adjusted gross estate. A family-owned business was defined as one where a) at least 50 percent of such entity is owned directly or indirectly by the decedent and members of his family or b) at least 70 percent is owned by members of two families and at least 30 percent is owned by decedent and members of his family, or c) at least 90 percent is owned by members of three families and at least 30 percent is owned by decedent and members of his family. Ownership interests in publicly traded companies and companies located outside of the U.S. were excluded. The participation tests were similar to those used for special use valuation. This special benefit was repealed effective December 31, 2003, but the sunset provision of the Economic Growth and Tax Relief Reconciliation Act of 2001 will reinstate this deduction beginning January 1, 2011, unless the estate tax law is modified before December 31, 2010.