With the removal of the President's deadline for passage of a Health Care Reform bill, Congress is once again freed up to do what it does best, which is not much. The result is another postponement of action with regard to the federal estate tax exemption. The proposed health care reform bills offered by the House and the Senate were phenomenally expensive, therefore within the proposed bills, there were various revenue resources. A study by the Tax Foundation found that under the proposed House bill, the tax increases which are scheduled to kick in by 2011, will result in income tax rates that will exceed 50% in 24 of the 50 states.
Revenue was also expected to come from federal estate tax. The federal estate tax exemption, which under current law, is $3.5 million, but is zero in 2010, and then $1 million in 2011, was to be frozen. Amazingly, Republicans in the senate were able to push through a freeze of the exemption at $5 million within their proposed bill. However, with the demise of the deadline for enactment, the hope that a $5 million exemption will stick begins to fade. It is a false hope anyway. There are more Democrats in the House than in the Senate and they are not likely to support an increase from the current $3.5 million exemption.
Stay tuned, sports fans. The game of Where Will The Federal Estate Tax Exemption Land is far from over. One thing is for sure: There is no way that this Congress is going to allow 2010 to go with no estate tax revenue, so they are going to have to do something and they are going to have to do it soon.
Revenue was also expected to come from federal estate tax. The federal estate tax exemption, which under current law, is $3.5 million, but is zero in 2010, and then $1 million in 2011, was to be frozen. Amazingly, Republicans in the senate were able to push through a freeze of the exemption at $5 million within their proposed bill. However, with the demise of the deadline for enactment, the hope that a $5 million exemption will stick begins to fade. It is a false hope anyway. There are more Democrats in the House than in the Senate and they are not likely to support an increase from the current $3.5 million exemption.
Stay tuned, sports fans. The game of Where Will The Federal Estate Tax Exemption Land is far from over. One thing is for sure: There is no way that this Congress is going to allow 2010 to go with no estate tax revenue, so they are going to have to do something and they are going to have to do it soon.
