Lawmakers Offer Tax Relief Solutions
The U.S. House of Representatives passed the Permanent Estate Tax Relief for Families, Farmers, and Small Businesses Act of 2009 on Thursday with a vote of 225 to 200. If signed into law, the bill would exempt estates up to $3.5 million per individual and $7 million for married couples, with a maximum rate of 45% on estates above those thresholds. In addition, the bill would repeal the enactment of carryover basis rules that would require many heirs, including those exempt from paying estate taxes, to pay additional taxes on the built-in gains of property inherited, beginning in 2010.
“This is a fair and responsible bill which eliminates any doubt as to the future of the estate tax, allowing businesses, large and small, to focus on jumpstarting our economy and putting Americans back to work,” said Rep. Charles Rangel (D-New York). Senate Finance Committee Chairman Max Baucus (D-Montana) hopes to bring a similar bill to the Senate floor by year’s end.
Earlier this week Senate small business committee chair, Mary Landrieu (D-Louisiana), and ranking member Olympia Snowe (R-Maine) introduced legislation that would make permanent expensing limits enacted in the American Recovery and Reinvestment Act. It would allow small businesses to deduct up to $250,000 of the cost of qualifying property in the year it’s purchased rather than through depreciation deductions over a number of years.
“By extending and expanding tax measures that we know help small businesses grow, we can give these businesses the certainty they need to make new investments and the encouragement they need to help grow our economy,” Landrieu said.