Bill Provides Permanent Estate Tax Relief for 99.8% of All Americans

Washington, DC – Congressman Joe Baca (D-Rialto) today joined a majority in the House of Representatives to support legislation that will permanently extend estate tax relief to ensure that 99.8 percent of estates in America never pay a dime of taxes.  H.R. 4151, the Permanent Estate Tax Relief for Families, Farmers, and Small Businesses Act of 2009, was approved by a 225 - 200 vote.

“America must have an estate tax policy that is flexible enough to not penalize hardworking small business owners and farmers, while also creating greater stability for our entire economy,” said Rep. Baca.  “This responsible compromise bill helps hundreds of thousands of American families by maintaining the current estate tax exemption levels, and ensuring an equitable system that promotes greater economic opportunity.”

H.R. 4151 marks a sharp departure from the last eight years in which Republicans fought to completely repeal the estate tax – providing tax cuts that would help only the wealthiest 2 in 1,000 Americans.  The bill maintains the estate tax exemption at $7 million per couple, instead of letting it drop to $2 million in 2011, and maintains the current tax rate of 45 percent. If Congress failed to act on estate tax relief extension legislation this year, the estate tax would be eliminated entirely in 2010; and in 2011, the maximum estate tax rate would increase to 55 percent (from 45 percent this year), applying to all estates above $1 million per individual.

Under the rules of the House, H.R. 4151 was combined with statutory “pay-as-you-go” legislation, restoring 1990s law that turned record deficits into surpluses by forcing tough choices on spending and taxes.

“Under the provisions of this bill, only 7,600 estates nationwide will pay estate taxes in 2011,” concluded Rep. Baca.  “This is 37,000 fewer than would be effected by current law.  This critical relief will play an important role in creating future job creation and economic growth, and provides stability for the business community as we continue to face the enormous challenges of the economic crisis.”