◼ Obama is seeking a stripped down deal to prevent tax rates from rising on all but the wealthiest Americans and to stop steep across-the-board spending cuts. - Reuters ◼ Via Drudge
The White House last week proposed a broader package that would have let tax rates stay low for those making up to $400,000, a compromise from the president's previous rate hike threshold of $250,000.
House of Representatives Speaker John Boehner was unimpressed with the offer and sought unsuccessfully to push his own proposal through Congress, but members of his own Republican Party balked at rate hikes of any kind. Talks broke down after that and the president and lawmakers left town for the holiday.
◼ Obama making proposal to Senate GOP on 'fiscal cliff'
◼ House to Return Sunday... - Politico
◼ REID: Boehner runs 'dictatorship'... - CBS Washington
◼ Deal 'virtually impossible' before New Year... - Politico
◼ Geithner Moves Up Debt Limit to Dec. 31... - CNS
◼ States May Want 'Cliff'... - Reuters
Falling off the "fiscal cliff" is a bad thing, right? Not necessarily for some state governments that could begin collecting more in estate taxes on wealth left to heirs if the United States goes over the "cliff," allowing sharp tax increases and federal spending cuts to take effect in January.
In an example of federal and state tax law interaction that gets little notice on Capitol Hill, 30 states next year could collect $3 billion more in estate taxes if Congress and President Barack Obama do not act soon, estimated the Urban-Brookings Tax Policy Center, a Washington think tank.
The reason? The federal estate tax would return with a vengeance and so would a federal credit system that shares a portion of it with the 30 states. They had been getting their cut of this tax revenue stream until the early 2000s. That was when the credit system for payment of state estate tax went away due to tax cuts enacted under former President George W. Bush.
With the return of the credit system next year as part of the "cliff," states such as Florida, Colorado and Texas -- which have not collected estate tax since 2004 -- could resume doing so. California Gov. Jerry Brown has already begun to add the anticipated estate tax revenue into his plans, including $45 million of it in his 2012-2013 revised budget.
Brown may or may not be jumping the gun.
◼ STOCKS TUMBLE... - CNBC
