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Estate Tax Could Disappear in 2010 and Return in 2011
As the Congress prepared to depart for the year, Senate Republicans blocked a plan by Democrats to extend the federal estate tax for two months at 2009 rates — with $3.5 million and $7 million exemptions for individual and couples, respectively, and a 45% tax rate on amounts above those levels.
Under current law, the estate tax will disappear in 2010 and return in 2011 with a $1 million exemption and a top rate of 55%.
The House earlier this month passed H.R. 4154, legislation that would make the 2009 estate tax provisions permanent. Senate Republicans failed to agree to this approach, even on a temporary basis. Instead, they called for a more generous permanent change that would increase the exemption to $5 million per individual and $10 million per couple, at a 35% tax rate above those levels. As a result, it is uncertain whether lawmakers will move to retroactively resurrect some type of estate tax in 2010 or look for a permanent fix to take place in 2011.
To read H.R. 4154, click here and enter the bill number at the upper center of the page.
For more information, e-mail Greg Brown at NAHB, or call him at 800-368-5242 x8421.
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