Cut in Minimum Tax Not Likely, Lawmaker Says

[papau]

A competing tax plan from the House means debate over tax cuts will be postponed until 2006.

http://www.nytimes.com/2005/12/14/politics/14cong.html
December 14, 2005

Cut in Minimum Tax Not Likely, Lawmaker Says

By CARL HULSE

WASHINGTON, Dec. 13 - Senator Bill Frist, the majority leader, said Tuesday that Congress was not likely to act this year to shield millions of middle- and upper-income taxpayers from a larger income tax bite as lawmakers moved into the final days of the session with many major issues hanging in the balance.

In laying out what he hoped to accomplish before adjourning for the year, Mr. Frist, Republican of Tennessee, said that "in all likelihood" the Senate would not try to reach agreement with the House on competing $30 billion plans to reduce the impact of the alternative minimum tax. The tax, originally created to prevent the rich from escaping tax liability, is expected to reach another 15 million Americans next year because of inflation.
Mr. Frist's position means it is likely that Congress will also delay until 2006 a larger debate over nearly $100 million in tax breaks that Republicans say are essential to economic growth. But the House and Senate have taken different approaches on tax relief, with the House extending lower tax rates on investments while the Senate balked because of opposition from Democrats and Republican moderates.

The so-called patch for the alternative minimum tax could still be approved next year and made retroactive to cover taxes for 2006, and Republicans have indicated that they intend to take some action. The new impact of the tax on some families with incomes below $100,000 and most of those with incomes between $100,000 and $200,000 would be reflected in taxes due in 2007.

In the House, which last week passed a separate plan to ease the alternative minimum tax in an effort to entice the Senate into tax negotiations, Representative Roy Blunt of Missouri, the acting majority leader, said he thought a deal could still be reached. But he acknowledged that Mr. Frist was the best judge of what would be possible in the Senate.

Democrats attacked the decision, saying the Republican majority was stalling action on one piece of tax relief that benefited the less affluent. "This should have been our No. 1 tax priority and instead, because of right-wing ideological objectives, the middle and upper class will suffer and only the very, very wealthy will benefit," said Senator Charles E. Schumer, Democrat of New York.<snip>

[papau]

1. Frist Says AMT Fix May Be Deferred

http://www.washingtonpost.com/wp-dyn/content/article/2005/12/13/AR2005121301869_pf.html

Frist Says AMT Fix May Be Deferred
Bloomberg News
Wednesday, December 14, 2005; A09

Senate Majority Leader Bill Frist (R-Tenn.) said Congress may postpone until next year a measure to prevent 15 million households from paying $30 billion under the alternative minimum tax, indicating that extending tax cuts on capital gains and dividends was a higher priority.

"I feel strongly that capital gains and dividends should be in the bill when it comes back to the Senate floor," Frist told reporters. Of the minimum tax, he said that "in all likelihood, we'll not be able to finalize that until we get back" in 2006.

The Senate will likely take up the tax-cut extensions either before it adjourns at the end of this week or early next year. Frist's comments signaled that the Senate may remove the AMT measure from budget legislation it passed in November, adopting instead a measure passed by the House last week to extend the 15 percent rate on dividends and most capital gains until 2010.

Congress is trying to wrap up budget legislation. The House voted 234 to 197 last week to approve a $56.1 billion measure that extends the rate on dividends and capital gains along with other expiring tax breaks. The Senate last month passed $68 billion in tax cuts, the bulk of which would prevent 15 million households from being subject to the minimum tax next year. The two chambers have not scheduled negotiations toward a compromise.<snip>

[papau]

3. Frist Says Senate May Act on Tax Cuts, AMT Separately

http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aiBbUjPktwt0

Frist Says Senate May Act on Tax Cuts, AMT Separately (Update5)

By Laura Litvan and Ryan J. Donmoyer

Dec. 13 (Bloomberg) -- U.S. Senate Majority Leader Bill Frist said Congress may postpone until next year a measure to prevent 15 million households from paying $30 billion under the alternative minimum taxes and indicated that extending tax cuts on capital gains and dividends was a higher priority.

``I feel strongly that capital gains and dividends should be in the bill when it comes back to the Senate floor,'' Frist, a Tennessee Republican, told reporters. Of the minimum tax, he said, ``In all likelihood we'll not be able to finalize that until we get back'' in 2006.
The Senate will likely take up the tax-cut extensions either before it adjourns at the end of this week or early next year. Frist's comments signaled that the Senate may remove the AMT measure from budget legislation it passed in November and instead adopt a measure passed by the House last week to extend the 15 percent rate on dividends and most capital gains until 2010.

Budget measures are protected from filibusters, the legislative tactic that requires 60 votes to overcome, and Frist would only have to find 50 votes to adopt the investment-tax cuts. Republicans have 55 seats in the 100-member Senate.

Congress is trying to wrap up budget legislation for next year. The House voted 234-197 last week to approve a $56.1 billion measure that extends the rate on dividends and capital gains along with other expiring tax breaks. The Senate last month passed $68 billion in tax cuts, the bulk of which would pay for preventing 15 million households from being subject to the minimum tax next year. The two chambers haven't scheduled negotiations aimed at crafting a compromise.
<snip>

[Supersedeas]

6. will get to the lil people laters....mayyyyybeh

[unblock]

2. and of course, it's mostly BLUE-staters who will suffer.

the bottom line is that the banana republicans need the revenue, and this is one of the few ways they can make people pay more in taxes without necessarily being accused of increasing taxes.

but that won't stop ME.

BANANA REPUBLICANS HIKE TAXES!!

[papau]

4. very true :-(

:-(

[Mountainman]

5. It helps them say the tax cuts have increased revenue.

The increased revenue comes from the middle class who have been hit with higher and higher taxes. I got hit with the ATM last year. I was hoping for less of a tax bite because I got a second mortgage but when I went to calculate the tax due I was shocked to learn that the ATM disallowed my deductions and I sure the hell am not wealthy. I still owe the tax! If I earn enough to cover my debts, I have to pay more tax which adds to my debts because I don't earn enough to pay my debts and taxes both. If I earn less I default on my debts. I won't be able to improve the situation until some years from now when my debts are paid off or the repukes remove the ATM. They sure would be in a hurry to get rid of the mortgage interest deduction and make the tax cut for the wealthy permanent though.