Earlier this week we heard that President Obama negotiated a truce with Congressional Republicans by agreeing to extend the Bush era tax for another two years. However, Senate Democrats blocked a vote on the proposal. Meanwhile, Republicans refuse to approve any legislation unless the obtain tax cuts for everyone. Thus, leaving everyone at risk for higher taxes. Now, word out of Washington DC is that Democrats are planning to vote on a proposal nearly identical to the Obama/Republican agreement with a few changes. So, the question arises… will the tax cuts be extended for another two years or not.
As a side note, there is are a couple of interesting nuggets in the Obama/Republican agreement with respect to estate taxes, which will be coming back in 2011. First, the estate tax will be lowered to 45%. Second, there will be a personal exemption from the estate tax up to $5 million.