Outlook for Estate-Tax Repeal in Congress This Year Dims Wall Street Journal (03/27/03) Vol. 13, No. 3 p.D2; Herman, Tom
With the war in Iraq underway, business groups realize the prospects of lawmakers passing legislation for the permanent repeal of the estate tax this year are remote, but they remain optimistic. Even if Congress does not act on a measure this session, tax attorneys are almost certain the issue will see some action by Jan. 1, 2004. Next year, the basic estate-tax exclusion is slated to rise 50 percent from the current $1 million per person to $1.5 million, then in 2006 through 2008 it will rise to $2 million. The estate-tax exclusion will rise to $3.5 million in 2009, then fall to zero the following year. Lawmakers had hoped a resolution on the issue would come this year, but efforts have been eclipsed by more pressing matters, including the war with Iraq, crippling budget deficits, not to mention stiff opposition in Congress. Critics of the president's proposal to repeal estate taxes maintain that such action would bestow unmerited tax advantages to the nation's wealthy who are in a position to pay the tax. But supporters of the proposal are still holding out for a compromise. One alternative being discussed would raise the $1 million exclusion to $5 million, or higher, this year, which would eliminate the tax for all except the super-rich.