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The fight over taxes builds

Posted by Admin Posted on Nov 29 2010

As Congress maneuvers to address tax laws that expire on December 31 (mostly in place since 2001, but some added in the last two years), the public relations battle has begun in earnest.

On the Sunday Warren Buffet weighed in on ABC in favor of letting the cuts expire for wealthier taxpayers http://www.bloomberg.com/news/2010-11-21/warren-buffett-tells-abc-rich-people-should-pay-more-in-taxes.html

A group calling themselves Patriotic Millionaires for Fiscal Strength have sent a letter to President Obama supporting letting the tax cuts expire for those with more than $1 million of taxable income. http://www.accountingtoday.com/news/Millionaires-Offer-Let-Bush-Tax-Cuts-Expire-56398-1.html

Meanwhile, without guidance from Congress on how this all ends up, the IRS is delaying issuing tax withholding tables for 2011.  These tables are normally published in mid-November, but now seem unlikely to see the light of day before mid-January if Congress acts in December.  http://www.smartbrief.com/news/cpa/storyDetails.jsp?issueid=181F0D14-B78E-42A4-AB10-935FFBA1F640©id=6D2DD24F-75A7-4A4C-8395-4B2048C6E594&sid=a7e96186-79a3-4fd9-8a52-4e605dfc0c41&brief=cpa

Common wisdom says Congress will act in December, but it's a high stakes game of "chicken" as Republicans hold out for making all of the "Bush" cuts (but, so far, not the "Obama" cuts passed in 2009 and 2010) permanent, and Democrats want to limit the extension to the middle-class (however that's defined).  The Democrats lose control of the House in January, and will have a much tougher time getting what they want if they don't act now.

 

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