“ Trusts with inclusion ratio greater than zero.—If a trust has an inclusion ratio of greater than zero and less than 1, a severance is a qualified severance only if the single trust is divided into two trusts, one of which receives a fractional share of the total value of all trust assets equal to the applicable fraction of the single trust immediately before the severance. In such case, the trust receiving such fractional share shall have an inclusion ratio of zero and the other trust shall have an inclusion ratio of 1. ”

“ Qualifying income interest for life.—The surviving spouse has a qualifying income interest for life if— `` (i) the surviving spouse is entitled to all the income from the property, payable annually or at more frequent intervals, or has a usufruct interest for life in the property, and `` (ii) no person has a power to appoint any part of the property to any person other than the surviving spouse. ”

“ In general.—If— `` (A) a non-skip person has an interest or a future interest in a trust to which any transfer has been made, `` (B) such person— `` (i) is a lineal descendant of a grandparent of the transferor or of a grandparent of the transferor's spouse or former spouse, and `` (ii) is assigned to a generation below the generation assignment of the transferor, and `` (C) such person predeceases the transferor, then the transferor may make an allocation of any of such transferor's unused GST exemption to any previous transfer or transfers to the trust on a chronological basis. ”

“ Limitation.—The term `qualifying lending and finance business' shall not include any interest in an entity, if the stock or debt of such entity or a controlled group (as defined in section 267 (f) (1) ) of which such entity was a member was readily tradable on an established securities market or secondary market (as defined by the Secretary) at any time within 3 years before the date of the decedent's death.''. (b) Effective Date.—The amendment made by this section shall apply to estates of decedents dying after December 31, 2001. ”

“ Returns Relating to Large Transfers at Death.—The return required by section 6018 with respect to a decedent shall be filed with the return of the tax imposed by chapter 1 for the decedent's last taxable year or such later date specified in regulations prescribed by the Secretary.''. (B) Conforming amendments.—Paragraph (3) of section 6075 (b) is amended— (i) by striking ``estate tax return'' in the heading and inserting ``section 6018 return'', and (ii) by striking `` (relating to estate tax returns) '' and inserting `` (relating to returns relating to large transfers at death) ''. ”

“ Lifetime transfers to nonresident aliens.—Subsection (a) shall not apply to a lifetime transfer to a nonresident alien.''. (C) The section heading for section 684 is amended by inserting ``and nonresident aliens'' after ``estates''. (D) The item relating to section 684 in the table of sections for subpart F of part I of subchapter J of chapter 1 is amended by inserting ``and nonresident aliens'' after ``estates''. ”

“ Maximum rate.— The maximum ``In calendar year: rate is: 2003 ............................ 49 percent 2004 ............................ 48 percent 2005 ............................ 47 percent 2006 ............................ ”