Latest on the Tax Deal: Payroll Tax Cut, Estate Tax Back

NRO ^ | December 6, 2010 | Daniel Foster

[ejdrapes]

Latest on the Tax Deal: Payroll Tax Cut, Estate Tax Back

December 6, 2010 4:45 P.M.

By Daniel Foster    

What we’re hearing: A two-year extension of all current income, dividend, and capital gains tax rates, plus a one-year (or 13 month) extension of unemployment insurance.

Chuck Todd reports that the tax deal could include a payroll tax holiday. But Marc Ambinder reports that it will instead include a two percent two percentage point reduction in payroll tax that would replace President Obama’s favored Making Work Pay tax credit, and a reinstatement of the estate tax over a certain yet-to-be-decided threshold.

Multiple reports are indicating a deal is close to being struck.

UPDATE: We’re now hearing that the estate tax will be set at 35 percent for two years, with the first $5 million exempted. [Daily Caller's Jon Ward first to report.]

UPDATE II: Jake Tapper has more details on what’s in the proposed deal, including:

–allowing businesses to deduct 100% of certain investments in the first year (President Obama pitched this in September).

–extending the American Opportunity Tax Credit (college tuition), Child Tax Credit and Earned Income Tax Credit plus their refundability. 

One other wrinkle Tapper is reporting, potentially huge: the unemployment benefits extension will not be offset, at least not as part of this deal. This makes it likelier that Republicans in both houses will challenge it from the right, and that any voting majority will have to be cobbled together from both caucuses.

President Obama is supposed to address the deal at 6:10 PM.

[Candor7]

You hit the gong with that post. Yes, these "extensions" will have no effect on permanent employment positions coming into the job market.All this while extending the dole and making millions of Americans dependent on ZERO.

I am afraid the GOP RINOS $hit the bed again.

Where in bloody "H" is their backbone and leadership? Are they effing insane???

The dems tossed them a bone when they could have had the meat.It makes me sick to see these RINOS scrambbling like dogs after it.

[vette6387]

So if I understand you correctly, you would rather that the middle class have to endure a substantial tax increase while the economy is still in the tank rather than give the RATs anything! You “purists” really give me a pain in the a$$. I don’t like anything about the part of this deal that give the RATs something, but at least I am enough of a realist to understand that under the current conditions this is what’s available.

[A_Tradition_Continues]

Will the extension of unemployment benefits be paid for with equal cuts elsewhere?

[SouthTexas]

Now you’re starting to sound like the feds!

[sthguard]

Good grief. I work full-time, and most weeks I don’t take home $450!

[Red in Blue PA]

The "99'ers" will now be known as "155'ers" with the 13 month extension.

Where are you getting your information?

It is 99 weeks max, and that is only in high unemployment states.....all others max out at 79 weeks.

[dools0007world]

It’s probably a little too soon to know what this tax package really does or does not due. That said, given that we must still contend with the Senate and WH in Marxist control, I think we got a pretty good deal. No I don’t like extending unemployment, but—as you say—it’s only gonna aggravate the unemployment numbers. Looking at it that way I think The White House Usurper shot himself in the foot. High unemployment numbers will insure a Marxist defeat in 2012.

As for the estate tax, this can be fixed in two years once the gang of commies are run out of Washington.

All told, I think what has happened is exactly what many of us want to happen. The Marxist agenda is already being beaten back and the new folks are not even in office yet. In the absence of any other info, I think the stage has been set for relentless reversal of the Onada agenda over the next two years. Then conservatives will take back the Senate and WH.

It took over 50 years to bring the country to this sorry state. One mid-term election is not gonna turn things around on a dime. That does not mean we allow those folks we elected to get comfortable. They need constant reminding that we are watching them and will hold them accountable.

[italianquaker]

Obama gets nothing but hate from the left for this

[The_Reader_David]

Wrong move. The ‘Rats still control both houses of Congress. If our folks don’t compromise with them now, all they have to do is wait for the automatic tax increases next year—which the left would think is fine. Until the new congress (the folks who won in November, besides Senator Kirk who won a special election and was already sworn in), the ‘Rats just need to peal off two RINOs in the Senate and they can still pass anything they bloody well please.

Even after January, we don’t have veto-proof majorities, and will have to force Obama and the ‘Rat controlled Senate to do the right thing by holding funding for various and sundry things (HHS, DHS, EPA, . . .) hostage. No government shut-downs, just fund each agency in a separate bill, which contains relevant restrictions on government activities: the HHS funding bill contains the repeal of Obamacare, the DHS funding bill requires the TSA to abandon back-scatter x-rays and groping in favor of behavioral profiling, the EPA funding bill forbids the classification of CO2 as a pollutant or regulation of CO2 emissions, a bill funding the IRS audit division contains language making the Bush tax cuts permanent. . . . But all this happens after we control the House.

[GreaterSwiss]

When your enemies are telling you how much you are winning.. you probably lost

The unemployment will stay at 2 yrs keeping the economy bad. States will start going under. SS will have a bigger deficit... The estate tax is back.

[GlockThe Vote]

Look i cant stand bama but overall this is a decent deal

[WOSG]

“What part of WE WON doesn’t the GOP get?!?!?!? Call your congressman and tell them HELL NO! “

YES!

2 years is too short. Why not make it permanent already!?!?
extending UI is too expensive without budget offset.

This has become a ‘christmas tree’ deal that will add to the deficit. where’s the fiscal responsibility?

Now, we have to pass it in a lame duck Dem session, but come Jan 3, a better congress can be found. Let’s argue over this until Jan 3 so we can get a better deal.

Best part is - we stop the rest of the Democrat lame duck agenda.

[WOSG]

Didn’t someone in the Senate, Democrat Senator Bennet, say as much?

[WOSG]

If we do NOTHING, all Americans get a massive tax increase.

So what is the ‘will of the people’ on this issue? Why is this deal, which continues current tax rates as should happen, ‘selling out’? I would have liked it made permanent. What would YOU have done?

[WOSG]

“Two years was 0bama’s opening position.”

His opening position was to extend it only for under $250,000 earners.

” We should have argued for “Forever,” and settled on 6-8 years.”

I agree. Minimum should have been 3 years, 8 yrs or forever much better. 2 years is barely worth voting for. Apparently we are going to let the recovery get a head of steam, and THEN kill it with tax hikes....

[WOSG]

“Otherwise, this is a victory for conservative
If this is victory, I’d hate to see defeat. “

You have a short memory.... Obamacare, stimulus, cap & tax, budget-busting pork bills... that was just the last 20 months.

Now we have, even before the new Congress is sworn in: Obama caves on taxes, doing the one thing he promised in his campaign NOT to do, and approve and validate the Bush tax cuts.
Small victory. half-a-loaf. compromise. lousy deal. Whatever you call it ... It’s still a move in the RIGHT direction, for the first time in about 4 years, the first thing that will move us, just for a while, in the tax-us-less direction.

I think the GOP should have bargained harder myself, we need more boldness and vigor and fight in what we do, but its not a defeat.

[WOSG]

No, this is good thing, because Obama’s tax CREDIT was a giveaway whether you worked or not, but this is a direct tax RATE CUT.

It’s a direct work-enhancing tax cut and a MUCH better deal than extending UI.

And the “YOUR account” is a fiction, unless and until we get individualized SocSec accounts. YOu are merely validating higher taxes with that concept. I dont WANT higher SocSec, I’d rather pay lower taxes and expect nothing in return than pay 15%+ percent for the SocSec stipend. Socialist Insecurity is a Bad deal without invidual choice and empowerment.

[KTM rider]

GOP: the Grand Oligarchy Party, democrat socialist light, the other leftist party

[WOSG]

“Yeah, after reading up on “the deal” I basically agree. Looks like the GOP did pretty good. This seems like a tax cut deal to include Bush and Obama tax cuts, most of which seem acceptable and somewhat stimulative for the economy. “

Yup. Piper is paid later on.