Just as this author has feared and has been warning, it is beginning to appear that Congress will not address the estate tax law until after the November election. The Hill, of course the Hill, in an article by Alexander Bolton reports that the “Democrats will punt on taxes.” They report some Democrats want to wait to address the issue of all taxes until after the Debt Commission issues its report in early December. However, if past is prologue, that would mean they would not have time to do anything before the session of Congress ends, just like the end of 2009. (Which gave us the mess we are in with no estate tax and a limited step up in basis.)
Other Democrats want us to get back to a $1,000,000 estate tax exemption (Sen. Harkin).
Senate Finance Chair Baucus says he will address the Bush tax cuts until the Senate deals with the “extenders”. He means the bill that would extend into 2010 certain tax provisions that expired at the end of 2009 (the itemized deduction for sales taxes, the additional standard deduction for real property taxes, and deductions for tuition and teacher expenses).
This not good. The extenders had been lumped in with the extension of unemployment benefits, a political football, not likely to pass.
On the other hand, the Hill reports Senator Bingaman, a Democrat member of Senate Finance, wants to get the Bush tax cuts addressed before the August recess. So there is some glimmer of hope they may include the estate tax in such legislation. However, it has not even been introduced (to my knowledge).
On the other hand, some Republicans are stating they believe the issue will not be addressed until the lame duck session.
Senate Majority Leader Reid commented about dealing with the Bush tax cuts and by implication the estate tax:
“Maybe if they (the Republicans) stop stalling everything that comes to the floor we might be able to get to that stuff. We’ll get to that when we get through unemployment insurance, Wall Street reform, and a few other things.”
The article is at http://thehill.com/homenews/senate/106619-dems-to-punt-on-taxes
By Kevin Staker