Small Business Tax Relief Act of 1981

Small Business Tax Relief Act of 1981 - Amends the Internal Revenue Code to reduce corporate income tax rates. Increases from 15 to 25 the permissible number of shareholders in a subchapter S corporation.

Increases from $100,000 to $300,000 the allowable cost of used property eligible for the investment tax credit. Provides for a three-year carryback and a seven-year carryover of amounts which exceed $350,000 for any taxable year.

Reduces the estate and gift tax rates. Provides for an exemption of $300,000 reduced by amounts allowed as specific exemptions by repealed Code provisions from the gross estate and from the amount used in computing taxable gifts. Repeals the unified credit against the estate and gift taxes. Increases from $3,000 to $10,000 the annual gift tax exclusion.