Posted on February 28, 2009 by Joseph M. Wallin

Tax Increase Proposals (Update on Timing)

 From Office of Management and Budget Director Peter Orszag's blog:

"Let’s focus specifically on the revenue increases for high-income taxpayers.   The Budget proposes that the tax cuts currently enjoyed by those with incomes above $250,000 be allowed to expire at the beginning of 2011, at which point the economy should have recovered from the current downturn.  Again, the revenue increases for those with incomes of $250,000 or more a year would become effective January 1, 2011 – and not before.*"

See here.

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Posted on February 22, 2009 by Joseph M. Wallin

What Will Obama's First Budget Do With Taxes?

The Washington Post is reporting some details on what Obama's first budget will do with respect to taxes.  The current speculation is as follows:

  • it will allow the temporary tax cuts of 2001 and 2003 to expire and not be re-enacted;
  • families earning more than $250,000 per year will see their tax rates rise;
  • the top individual income tax rate will rise from 35% to 39.6%;
  • capital gains tax rates will increase to 20% for wealthy tax filers; and
  • for hedge funds, carried interest will be taxed as ordinary income, not capital gains.

I have not heard anything yet with respect to the FICA wage base cap and whether that will be repealed entirely or in part.

Of course, this is preliminary.  We will report more as we learn more.

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