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Certain magnetic recording head designs require a controlled etching of the tantalum (Ta) capping layer of the giant magnetoresistive (GMR) read sensor, in order to establish electrical and/or magnetic coupling between the active layer of the sensor and a subsequently deposited layer. This is useful in schemes such as, but not limited to, lead-overlay and exchange stabilization of the sensor free layer. This paper discusses ion beam etching and reactive ion etching of the Ta sensor capping layer. Advantages and limitations of each approach are discussed. Limitations of physical etching due to issues such as Ta implantation in the NiFe active layer of the spin valve, shadowing, and poor selectivity are presented. A reactive ion etching approach that exhibits excellent selectivity between Ta and NiFe or CoFe is presented. The properties of exchange tab material deposited after using this etching process is shown.