|
The House, on June 22, 2006, voted 269 to 156 to approve the Permanent Estate Tax Relief Bill of 2006 (HR 5638), a compromise measure offered by House Ways and Means Committee Chairman William M. Thomas, R-Calif. The bipartisan vote sends the bill to the Senate, where its prospects for passage remain uncertain in the face of Democratic objections.
HR 5638 increases the exemption amount to $5 million per person, effective January 1, 2010. Any unused exemption would be carried over to the surviving spouse. The measure was amended on the House floor to index the exemption to inflation.
The bill would reduce the tax rate on estates worth up to $25 million to 15 percent. Estates worth more than $25 million would be taxed at 30 percent. The bill also created a new 60 percent deduction for qualified timber capital gains, effective from the date of enactment through 2008. The timber provision was added to gain support from Washington State Democrats, after an estate tax repeal bill (HR 8) failed to win approval in the Senate.
The Senate is expected to consider HR 5638 after July 4, 2006, but support is uncertain among GOP lawmakers who prefer total, permanent repeal of estate taxes.
During the House debate, Democrats sought to portray the estate tax bill as a sop for the rich, who want to pass on their wealth to heirs. Democrats said that the measure would add $800 billion to the federal budget deficit from 2010 to 2020 and only benefit 7,500 families.
Last Updated June 2006 |
|
Legislative update |
|
Copyright D. R. Silberstein 2009 All Rights Reserved |
|
Attorney and Counsellor at Law |
|
Federal Estate Tax |