Month: March 2008

March 20, 2008 04:02 PM | Permalink |

Last week, the House and Senate both passed their own versions of the fiscal year 2009 federal budget resolution. There are some important differences between them that must be worked out by a House-Senate conference committee, which will negotiate a final resolution to be passed by both chambers. Even though the budget resolution is not law and is not binding, it does serve as a blueprint for the tax and spending policies that Congress will pursue in the coming year. This blueprint can also include procedural rules that make it easier or more difficult to pass certain types of legislation.

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March 6, 2008 02:02 PM | Permalink |

The federal estate tax continues to have no effect on the vast majority of Americans. The most recent figures released from the IRS, combined with data on deaths in each state from the Center for Disease Control, show that less than one percent of deaths result in estate tax liability under the tax rules currently in effect.

Under the Bush tax cuts, those rules are scheduled to change to allow even more estates to escape the tax. In 2004 and 2005 estates worth up to $1.5 million (or $3 million for estates owned by a married couple) were exempt from the estate tax. (Most of the estates listed below were subject to that exemption.) Since then, the exemption has increased to $2 million ($4 million for married couples) and in 2009 the exemption will increase to $3.5 million ($7 million for married couples). In 2010 the estate tax will disappear entirely. After 2010 all the Bush tax breaks expire, including this generous treatment of estates. Some lawmakers want to make permanent the complete repeal of the estate tax, which would cost over a trillion dollars over a decade and clearly benefit only the very wealthiest families in America.

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