Tuesday, February 16, 2010

A Suggestion for Congress

There is a lot of talk these days about "bipartisanship" in Congress. Perhaps Congress needs to find some baby steps for the concept of putting the American taxpayer ahead of politics. Here is a suggestion for our legislators. Since we are waiting on a new Tax bill to straighten out the debacle of the repeal of the Estate Tax and Generation Skipping Transfer Tax, fix the imposition of the new "Modified Carryover Basis" tax regime that became effective on January 1, 2010. These new income tax rules dealing with basis are a nightmare for the heirs of those who have lost loved ones after January 1 of this year. Assuming the new tax bill will take a while to work out, at least spare those who were unlucky enough to die in this calendar year from the headache of trying to figure out all the new modified carryover basis rules. Surely both sides of the aisle can agree that the imposition of these taxes at this time are patently unfair. A simple bill to repeal the modified Carryover basis rules should be a slam dunk to sail through the House and Senate.

1 comment:

  1. Brad,

    Great post. Yes the modified Carry over basis rules are a complete nightmare. I think if Congress doesn't retroactively legislate this away there will be lots of disputes between trustees and beneficiaries especially in terms of which beneficiaries will get the benefit of the 1.5 million of step up basis.

    Also although the media has spun this year as a great year to die because of the repeal of the estate tax they seem to have largely ignored the little doosy in the modified carry over basis.