Looks like Congressional Democrats and President-elect Obama’s economic team are already beginning work on legislation to prevent a full repeal of the estate tax in 2010. The Wall Street Journal reports that President Obama’s plan will come out in February as part of his FY 2010 budget proposal and could be acted on by the House and Senate soon after. As the Journal reports:
The estate tax would be locked in permanently at the rate and exemption levels that took effect this year. That would exempt estates of $3.5 million — $7 million for couples — from any taxation. The value of estates above that would be taxed at 45%. If the tax were returned to Clinton-era levels, it would exclude $1 million from taxation with the rest taxed at 55%.
As previously reported by your S-CORP team, while many of the big tax issues confronting Congress may get put on hold until the economy begins to recover, some sort of deal on the estate tax could be one of the few major tax items considered this year.
The question now is how will Senate Republicans respond? Will they accept a deal that extends partial estate tax relief into 2011 and perhaps beyond, or will they hold out for full repeal knowing it will only last for a year?
Small Business Committee Looks at Stimulus
The House Small Business Committee held a hearing this morning on how to best help the small business community in the proposed stimulus package.
Net loss carry-backs, bonus depreciation, and increased small business expensing were among the suggestions made by the Roofers, Associated General Contractors, Independent Bankers, and other groups testifying.
The S-Corporation Association supports all of these provisions. If the economy is suffering primarily from a lack of capital, however, reforming the BIG tax could provide more economic bang for the buck than any of these other provisions. S-CORP Chairman Richard Roderick makes this case for BIG reform to the Committee in a letter to its Chairwoman, Nydia Velazquez.
Finance Committee Membership Taking Shape
In the wake of the Senate’s decision to seat Obama’s replacement, Roland Burris (D-IL), Senate Democrats have announced new committee ratios for the 111th Congress. Designed to reflect the overall ratio of Democrats to Republicans in the Senate, the Finance Committee will have 13 Democrats and 10 Republicans, an overall increase of 2 members (11-10) from last Congress.
This increase is something of a surprise — word was Chairman Baucus had hoped to reduce the size of the Committee to make it more manageable — and it means the Democrats have three new members (including replacing Sen. Ken Salazar (D-CO) who is leaving the Senate to become Secretary of the Interior) while the Republicans will pick two. The new Democratic members were also announced yesterday while we expect to hear from the Republican Leader today. New Democratic Members include:
Potential Republican contenders include Senators Mike Enzi (WY) and Richard Burr (NC). Senator George Voinovich was expected to be considered, but his retirement announcement this week took him out of contention.