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Pepperdine University School of Law

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Friday, August 7, 2009

CBO Releases 66 Tax Options

Budget Options, Volume 2 The Congressional Budget Office yesterday released Budget Options, Second Volume.  The document discusses 66 tax options:

  1. Increase Individual Income Tax Rates
  2. Permanently Extend the Individual Income Tax Provisions of EGTRRA
  3. Permanently Extend the Zero and 15% Tax Rates for Capital Gains and Dividends
  4. Replace Multiple Tax Rates on Long-Term Capital Gains with a Deduction of 45% of Net Realized Gains
  5. Provide Relief from the Individual Alternative Minimum Tax
  6. Use an Alternative Measure of Inflation to Index Some Portions of the Tax Code
  7. Reduce the Mortgage Interest Deduction or Replace It with a Tax Credit
  8. Limit or Eliminate the Deduction for State and Local Taxes
  9. Limit the Tax Benefit of Itemized Deductions to 15%
  10. Curtail the Deduction for Charitable Giving
  11. Limit Deductions for Charitable Gifts of Appreciated Assets to the Gifts’ Tax Basis
  12. Create an Above-the-Line Deduction for Charitable Giving
  13. Eliminate Tax Subsidies for Child and Dependent Care
  14. Eliminate the Additional Standard Deduction for Elderly and Blind Taxpayers
  15. Include Employer-Paid Premiums for Income-Replacement Insurance in Employees’ Taxable Income
  16. Eliminate the Tax Exclusion for Employment-Based Life Insurance
  17. Include Investment Income from Life Insurance and Annuities in Taxable Income
  18. Include All Income Earned Abroad by U.S. Citizens in Taxable Income
  19. Tax Carried Interest as Ordinary Income
  20. Tax Social Security and Railroad Retirement Benefits Like Defined-Benefit Pensions
  21. Consolidate and Simplify Different Types of Defined-Contribution Retirement Plans
  22. End the Preferential Treatment of Dividends Paid on Stock Held in Employee Stock Ownership Plans
  23. Modify the EITC for People Who Do Not Live with Children
  24. Include Social Security Benefits in Calculating the Phase-Out of the EITC
  25. Replace the Tax Exclusion for Interest Income on State and Local Bonds with a Tax Credit
  26. Consolidate Tax Credits and Deductions for Education Expenses
  27. Limit or Eliminate Eligibility for the Child Tax Credit
  28. Reduce the Top Corporate Income Tax Rate by 5% Points
  29. Set the Corporate Tax Rate at 35% for All Corporations
  30. Integrate Corporate and Individual Income Taxes Using the Dividend-Exclusion Method
  31. Repeal the “Lower of Cost or Market” Inventory Valuation Method
  32. Tax Large Credit Unions in the Same Way as Other Thrift Institutions
  33. End the Expensing of Exploration and Development Costs for Extractive Industries
  34. Tax the Income Earned by Public Electric Utilities
  35. Disallow Tax-Free Conversions of Large C Corporations to S Corporations
  36. Repeal the Low-Income Housing Credit
  37. Extend the Period for Recovering the Cost of Equipment Purchases
  38. Limit or Eliminate Tax-Exempt Private-Activity Bonds
  39. Cap Nonprofit Organizations’ Outstanding Stock of Tax-Exempt Bonds
  40. Repeal the Deduction for Domestic Production Activities
  41. Permanently Extend the Research and Experimentation Tax Credit
  42. Tax the Federal Home Loan Banks Under the Corporate Income Tax
  43. Tax Qualified Sponsorship Payments to Postsecondary Sports Programs
  44. Expand the Medicare Payroll Tax to Include All State and Local Government Employees
  45. Increase the Maximum Taxable Earnings for the Social Security Payroll Tax
  46. Require Self-Employed People and Employees to Pay the Same Amounts in Payroll Taxes
  47. Increase Federal Employees’ Contributions to Pension Plans
  48. Modify the Estate and Gift Tax Provisions of EGTRRA
  49. Eliminate the Source-Rules Exception for Exports
  50. Tax the Worldwide Income of U.S. Corporations as It Is Earned
  51. Exempt Active Foreign Dividends from U.S. Taxation
  52. Increase Excise Taxes on Motor Fuels
  53. Make Permanent the Partial Excise Tax Exemption for Biofuels
  54. Eliminate the Federal Communications Excise Tax and Universal Service Fund Fees
  55. Impose a Tax on Emissions of Sulfur Dioxide
  56. Impose a Tax on Emissions of Nitrogen Oxides
  57. Impose an “Upstream” Price on Emissions of Greenhouse Gases
  58. Reinstate the Superfund Taxes
  59. Make Permanent the Tax Credits for Generating Electricity from Renewable Sources
  60. Impose Fees for Use of the Inland Waterway System
  61. Charge for Examinations of State-Chartered Banks
  62. Charge Transaction Fees to Fund the Commodity Futures Trading Commission
  63. Charge Fees to Offset the Cost of Federal Rail Safety Activities
  64. Increase Registration Fees for the Federal Aviation Administration
  65. Finance the Food Safety and Inspection Service Solely Through Fees
  66. Establish New Fees for the Food and Drug Administration

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