WASHINGTON, D.C. – U.S. Rep. Charlie Dent (PA-15) last night voted for H.R. 4853, the Middle Class Tax Relief Act, which prevents a massive tax increase from taking effect on January 1, 2011. The bill extends many tax relief provisions established in 2001 and 2003 that are set to expire at the conclusion of 2010. Specifically, H.R. 4853 extends existing individual income tax rates for all Americans for two years, extends the child tax credit, preserves marriage penalty relief, protects middle-class families from the Alternative Minimum Tax (AMT), institutes sensible estate tax rates, and maintains the current rate of 15 percent on capital gains and dividends to encourage investment.
“I am pleased Congress has finally ensured American families and businesses will not face a significant tax increase in the New Year,” Dent said. “Preventing a massive tax hike will support needed economic growth by encouraging greater investment. In the midst of a recession, our failure to prevent looming increases would have been an incredible disservice to the American people.”
A major component of the legislation is the modification of estate tax rates, which would have risen to an astonishing 55 percent with only a $1 million exemption in 2011 without Congressional intervention. H.R. 4852 establishes a lower tax rate (35 percent) and higher exemption ($5 million) than previous years, ensuring the government does not claim over half the value of estates at the time of one’s death. During House consideration of the bill, Dent opposed an amendment offered by Rep. Earl Pomeroy (ND) that would have taxed estates at 45 percent.
“Providing the best possible estate tax relief is essential to preserving Pennsylvania’s family farms,” Dent explained. “Following the death of a loved one, local family farmers are too often forced to sell their property simply to afford the federal government’s hefty tax. I believe the estate tax levels agreed upon when this legislation was crafted are appropriate.”
The bill passed by the House is identical to legislation approved by the U.S. Senate earlier this week with overwhelming bipartisan support. It is the product of an agreement developed by the Obama Administration and Congressional Republicans.
“The passage of this bill proves to the American people that elected officials can deliver positive results when committed to constructive dialogue and a cooperative legislative process.”