The Tax Reform Act of 1976 initiated the first major changes in federal estate and gift tax regulations since the early 194O's. Recent rapid increases in land values have increased estate values and made successful intergenerational transfer of the farm firm more difficult. The new law is complex and will have a profound influence on estate planning in the future. Previous estate planning studies were completed prior to passage of the Tax Reform Act of 1976 (Boehlje and Eisgruber; Buss: Harl). The purpose of this paper is to analyze rhe potential impacts of the major federal estate and gift tax changes on estate planning and management strategies for farm firms.