Wednesday, May 19, 2010
An agreement has fallen apart on an estate tax proposal that had appeared resolved between Senate Democrats and Republicans, a lead negotiator said Tuesday. Senate Minority Whip Jon Kyl (R-Ariz.) said the accord, which was all but forged a week ago, began to dissolve Monday night and broke down Tuesday after talks between leaders in both parties. ...
Kyl hasn't disclosed the proposal's details, but sources have told The Hill that lawmakers were looking to give taxpayers the option of prepaying their estate tax. The levy would be set at 35% for those worth more than $3.5 million. However, the exemption would ultimately increase over time to $5 million and wouldn't be indexed for inflation. Prepayment trusts would pay a lower rate. ... It was unclear how the gift tax would be addressed but Kyl has said he would like the rate to mirror the estate tax.
The House recently passed legislation creating a 45% tax on estates worth more than $3.5 million.
- Wall Street Journal, US Senate Effort To Reduce Estate Tax Hits Turbulence