Thursday, July 15, 2010

Kyl-Lincoln proposal moving ahead

According to Tax Notes, Jon Kyl and Blanche Lincoln will submit their estate tax proposal (10-year phase-in to $5 million exemption and 35% tax rate) as an amendment to HR 5297, a pending bill with tax breaks for small business.

Apparently, their bill would be retroactive to the first of this year, but affected taxpayers would be given the option to choose carryover basis instead, thus eliminating the constitutional challenge.

Although this represents a sensible middle ground to the alternative of complete estate tax repeal, it can be demagogued as a giveaway to the rich at a time of crushing deficits.  I don't expect sanity.

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