More On Tax Planningfrom The Advisor's Professional Library
- IRAs: In General Individual Retirement Accounts are highly popular tools for contributing funds that grow on a tax deferred basis. Depending on the type of IRA, the accumulation can be tax free.
- Long Term Care Insurance: Premiums While premiums for qualified long-term-care insurance may be deductible as medical expenses there are exceptions to this general rule. Learn how to avoid unnecessary tax liabilities.
The Senate voted Monday evening against the Paying a Fair Share Act of 2012, also known as the Buffett Rule, which would set a minimum 30% tax on millionaires and billionaires.
While the 51-45 vote fell short of the 60 votes needed to advance the measure, Sens. Sheldon Whitehouse, D-RI, and Charles Schumer, D-NY, told reporters on a conference call early Monday afternoon that even if Senate democrats failed to get enough Senate republicans to vote in favor of the Buffett Rule proposal, they’d continue to fight to see it passed. “Even if we come up short of the 60 votes needed today, we’ll keep pushing this issue in the months ahead,” Schumer said on the call. Whitehouse agreed, stating: “We’re going to come back to this issue repeatedly.”
In his weekly address on Saturday, President Obama urged members of Congress to pass the Buffett Rule, stating that it’s a “principle of fairness that says if you make more than $1 million a year, you should pay at least the same percentage of your income in taxes as middle-class families. Meanwhile, if you make under $250,000 a year—like 98% of American families do—your taxes shouldn’t go up.”
Obama went on to say that “most Americans and nearly half of Republicans support” the Buffett rule, with one survey finding that “two-thirds of millionaires do, too.” Said Obama: “We just need some Republican politicians to get on board with where the country is.”
The Joint Committee on Taxation reported that the Buffett Rule would raise $47 billion over the next 10 years, a figure Republicans argue would put only a small dent in the federal deficit. But Martin Sullivan, chief economists at Tax Analysts, notes that “in the world we are likely to be facing for many years to come—where Republicans have veto power over any tax increases—a Buffett rule would likely raise much more than the oft-quoted $47 billion figure.” If the Bush tax cuts are extended, he says, “application of the Buffett rule would raise $162 billion over 10 years.”