Higher taxes will hit most U.S. households in the New Year if Congress doesn’t take action. American Farm Bureau Tax Specialist Pat Wolff says there are efforts to encourage Congress to keep those tax hikes from happening come January 1, 2013. So the focus is on the lame duck session after the election.
“There’s every reason in the world believe that they will do a tax package in December. It will be a huge tax increase if they don’t, which isn’t good news for most people, and it will have an impact on the stock market and our financial situation and that has a lot of people worried. On the other hand there’s every reason to believe they won’t because they’ve had almost two years now to try to figure it out and they haven’t got it done.”
Wolff says farmers and ranchers, who will be especially hard hit by giant hikes in estate and capital gains taxes, will be pushing for action on taxes to take priority.
“They’re only going to be here about three weeks and that’s really not very long. There’s a list of things they need to get done that’s as long as my arm. The tax bill is one of them, the farm bill is another. Dealing with the sequestration issue is a third and there’s a real possibility that they’ll not have enough time to do everything. So Farm Bureau has engaged in a grassroots campaign to push the tax items that we think are most important and that is making sure that we don’t have a huge increase in the estate taxes or capital gains taxes come January 1.”
Wolff says there is legislation in the works for a one-year extension of the current law.
“Just about everyone agrees that our tax code needs an overhaul, but letting taxes go up on January 1 is not a comprehensive look at our tax code; it’s a tax accident. That one year is designed to give Congress long enough to come back and do a thoughtful, comprehensive tax reform package.”
In addition to the capital gains tax rates going up, the estate tax rates going up, and the estate tax exemption going down, individual income tax rates and about 100 other tax code provisions are set to change.[audio:https://www.hoosieragtoday.com//wp-content/uploads//2012/10/Wolff-on-taxes.mp3|titles=Wolff on taxes]