I actually like the cut-off date of 1977.
I am in substantial agreement with Randy's post, but I wonder if even that date is far enough back. It excludes, just off the top of my head (and I'm very bad on chronology), The Dying Earth. In what way can we say with conviction that that is not a "modern" work? Poking about almost at random, R. A. Lafferty wrote Past Master in 1968. Going even farther back, Charles Williams' novels began appearing in 1930.
To me, the essence of the issue of "modernity" lies in the question "If this appeared today, in what way would we feel it is 'dated'?" There might, in the older works, be some trivial reference to, say, motor cars or trolleys or iceboxes, but if they are nothing substantive, nothing affecting the tale as tale, are things that could be editorially updated with no consequence at all, is not the work then thoroughly "modern"?
Science fiction has a much higher bar there, exactly because science really does march on; SF from, say, the '50s is usually painfully obviously of its time. But for fantasy, that is not so. The limits for fantasy are, I'd say just offhand, one of two things: changes in writing style so drastic that they make the period plain (few would mistake Le Fanu for a contemporary writer) or changes in social structure that alter the implicit assumptions of the society, whether historical or totally imagined.
Without any attempt to be rigorous, I much suspect that the bar is at least as far back as the end of WWII, and that not a little from even the '30s (as with Williams) could qualify.