The Duffey Law Firm Blog

Wednesday, December 8, 2010

Obama Cuts Tax Deal with Republicans!


Obama held a press conference on 12/6/10 to announce new Tax Deal with Republicans!  Here is what we know so far:

  • 1) two year extension of the Bush Tax Cuts (no restriction on taxpayer income);
  • 2) one year 2% reduction on Social Security withholding tax;
  • 3) Capital Gains and Dividend income will be taxed at 35% (for two more years) but perhaps the most contentious item of all -

This means that the first $5 million dollars of a decedent’s assets can be passed to their family or friends without any tax!

Which also means, for a married couple, the total amount of assets that can be passed to family or friends WITHOUT ANY ESTATE TAX will be $10 MILLION DOLLARS!

However, before you pop the champagne, you need to know that there is a lot of work remaining!  Many Democrats in the House and Senate are not yet ready to sign on to the Obama Tax Deal!

The Seattle Times reported on 12/7/10 that Obama’s Estate Tax proposal could lead to a revolt among Democrats in the House!

MSNBC aired an interview with Leo Gerard, President of the United Steel Workers Union on Tueseday, Dec. 7, 2010 in which he stated that “The Rich will make out like Bandits for two years!”

Forbes website’s headline following the White House’s announcement: OBAMA’s CHRISTMAS PRESENT FOR THE WEALTHIEST AMERICANS!”

MOVEON.ORG a strong ally of President Obama released an TV commercial which aired on cable networks Wednesday, December 8, 2010 chiding President Obama to “fight for them” and to fulfill his promise of “Change!” Finally, the ad concludes with a plea to change the deal and not allow a “windfall” for the Wealthy Americans who don’t need it!

No one knows for sure what the final compromise will look like, but for now we do know one thing, the Democrats and their allies in the Unions and other liberal organizations are not ready to sign on to this Tax Deal quite yet!

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