BIDEN SEEKS TO REDUCE ESTATE TAX EXEMPTION TO $3.5M!!
Updated: Feb 9
ESTATE TAX ALERT
By Stephen Cooper · January 22, 2021, 2:11 PM EST
The Senate will vote Monday on the confirmation of former Federal Reserve Chairwoman Janet Yellen as the nation's first female Treasury secretary, despite some Republican misgivings about her support for raising the corporate tax rate under President Joe Biden. Janet Yellen, President Joe Biden's choice for Treasury secretary, won unanimous approval from the Senate Finance Committee on Friday. (AP Photo/Manuel Balce Ceneta) The Senate Finance Committee voted early Friday to unanimously advance her nomination to the full Senate, with bipartisan members praising Yellen's experience at the Fed and as chairwoman of the White House Council of Economic Advisers. GOP lawmakers cited her willingness to discuss their differences on tax policy, and Democrats hailed Yellen as the perfect candidate to address the nation's economic problems from the coronavirus pandemic. Sen. Maria Cantwell, D-Wash., said she hopes Yellen will lead the Treasury to focus on workforce training and the "important aspects of getting America's economy and getting people back to work." Incoming Senate Finance Committee Chairman Ron Wyden, D-Ore., had sought a swift confirmation by the full Senate on Friday so that Yellen could begin work to address rising unemployment rates. However, Senate Majority Leader Charles Schumer, D-N.Y., announced later in the day that her nomination vote would occur Monday, just ahead of the formal beginning of Senate impeachment proceedings against former President Donald Trump. Schumer said the trial will start in earnest the week of Feb. 8, thereby giving the Senate a short period to process other cabinet nominations and another COVID-19 relief bill for millions of Americans who are suffering during the pandemic. Sen. Chuck Grassley, R-Iowa, the outgoing Finance Committee chairman, said he disagrees with Yellen's viewpoints but was encouraged by her commitment to work with lawmakers from both political parties. "We want to work on policy issues to help all Americans," Grassley said in a statement after the vote. "We are not interested in cancerous culture wars that serve only to divide the country." During a Senate hearing Tuesday to consider her nomination, Yellen pledged to pursue targeted tax relief for small businesses and families while also fulfilling Biden's campaign promise to revamp the GOP's 2017 tax overhaul law with higher tax rates for large corporations and wealthy individuals. The higher tax rates on large corporations would come later as part of a larger package that includes significant spending and investment proposals, Yellen said. While Biden wants to reverse the law's incentives for companies to move operations and profits overseas, he doesn't support a complete repeal of the 2017 Tax Cuts and Jobs Act, she said. Yellen released 114 pages of answers to wide-ranging questions from Finance Committee members, who raised concerns about Biden's plans for tax policy, raising the minimum wage, rebuilding infrastructure, Social Security solvency, renewable energy and combating the novel coronavirus pandemic. She defended Biden's plans for reducing the estate-tax exemption amount from $11.5 million to $3.5 million and increasing the top estate tax to 45% from 40%. Although GOP lawmakers charged that family farmers would be harmed by the changes, Yellen said that only "about the wealthiest six out of every thousand estates would face any tax — less than 1% — and every couple with assets under $7 million would be fully exempt from the estate tax." Yellen promised to study the potential impact of repealing the taxation of pass-through businesses under Internal Revenue Code Section 199A to determine "the extent to which it is helping to improve the prospects of America's small-business owners." Yellen also pledged to work with the Finance oCmmittee on Biden's proposal for a 15% corporate minimum tax based on book income determined under accounting principles, rather than taxable income reported to the IRS. She told lawmakers that Biden is intent on making sure that companies with low or zero tax liabilities pay their fair share. "Research has identified many examples of corporations with a large gap between their tax and book income," Yellen said. "A minimum book tax could help recapture the tax revenue lost to gaming and tax avoidance." Sen. Mike Crapo, R-Idaho, said he is willing to work with Yellen, despite opposing her views on tax policy. "I have very strong disagreements with Dr. Yellen on a number of her positions, particularly in the tax policy arena, but she has committed to us that she will work with us on these issues and concerns that we have," he said.