Well, here's to the U.S. House of Representatives- it was
close but they finally were able to accomplish something before it was too late.
One of the most
pressing for the housing market is the extension of the Debt Forgiveness Act…that
will keep most folks from having to pay taxes on the debt that was forgiven
when they do a short Sale. Now in
fairness they passed many other bills and here is an excerpt from the White
House summary;
■Restores the 39.6 percent rate
for high-income households, as in the 1990s: The top rate would return to 39.6
percent for singles with incomes above $400,000 and married couples with
incomes above $450,000.
■Capital gains rates for
high-income households return to Clinton-era levels: The capital gains rate
would return to what it was under President Clinton, 20 percent. Counting the
3.8 percent surcharge from the Affordable Care Act, dividends and capital gains
would be taxed at a rate of 23.8 percent for high-income households. These tax
rates would apply to singles above $400,000 and couples above $450,000.
■Reduced tax benefits for
households making over $250,000 (for singles) and $300,000 (for couples): The
agreement reinstates the Clinton-era limits on high-income tax benefits, the phase-out
of itemized deductions (“Pease”) and the Personal Exemption Phase-out (“PEP”),
for couples with incomes over $300,000 and singles with incomes over $250,000.
These two provisions reduce tax benefits for high-income households. This sets
the stage for future balanced approaches to deficit reduction, which could
include additional revenue through tax reforms that reduce tax benefits for
Americans making over $250,000.
■Raises tax rates on the
wealthiest estates: The agreement raises the tax rate on the wealthiest estates
– worth upwards of $5 million per person – from 35 percent to 40 percent, in
contrast to Republican proposals to continue the current estate tax levels.
■The agreement’s $620 billion
in revenue is 85 percent of the amount raised by the Senate-passed bill, if
that bill had been enacted and made permanent: The agreement locks in $620
billion in high-income revenue over the next ten years. In contrast, the bill
passed by Democrats in the Senate achieved approximately $70 billion through
one-year provisions; these same provisions could have raised a total of $715
billion over ten years if Congress acted again to extend it permanently.
However, the Senate bill itself locked in only one year’s worth of savings so
would have required additional extensions to achieve those savings
For a clearer view of what was passed click the link;
