Friday, December 04, 2009
The Senate may decide to just patch it over for one year at the 2009 rate, leaving the threat of the higher rate and lower exemption hanging into next year. Republicans might like to have that as a campaign plank, but I can't remember when I last saw a tea party for the estate tax.
The bill passed 225 to 200, with 26 Democrats joining all Republicans present in voting no. If Congress does not act, the estate tax will disappear in 2010, then return in 2011 under the higher rates -- 55 percent and a $1 million exemption -- that existed before President George W. Bush took office.
The tax is one of several bills and expiring laws that require attention from Congress by Dec. 31, even as the Senate expects to devote much of its time to the marathon health-care debate.
Nonetheless, this is a pretty big deal.
The Obama Administration supported the House bill at the beginning of this year. Someone in the White House press corps should ask Press Secretary Gibbs whether they still do and if they would like the Senate to take up the estate tax bill before finishing with the health care bill.
UPDATE: Well, that was bad! I missed the decimal in front of the 23 in the Post article. For the current year, the share of filers affected would be 0.23%. But a federal report from earlier this year shows that the number would rise to 2.5% of all returns, including 10% of farms, if we revert to the 2001 rates. About 3% of farms currently have assets over $3.5 million.
Thanks to Charlie Quimby for finding my mistake.