Temporary Tax Relief Act of 2007

hmoroz — Tue, 11 Dec 2007 11:47:23 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Number of taxpayers affected by the AMT in 2006, with the exemption that is extended in this legislation: 3.5 million

Number of taxpayers who will be affected by the AMT in 2007 if this legislation is not enacted into law: 23.4 million

Average compensation paid to the 25 individual hedge-fund managers with the highest earnings in 2006: $570,000,000

Approximate loss of revenue to the U.S. Treasury in 2006 alone from taxing the carried interest of these 25 fund managers as capital gains: $1,995,000,000

Amount that the IRS estimates it will spend in startup and ongoing maintenance costs through FY2007 for the private collection agency program: $71 million

Revenue the IRS estimates it would generate if it applied this $71 million to its own IRS Automated Collection System: $1.4 billion

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. The Temporary Tax Relief Act of 2007 ensures that middle-class Americans are not overwhelmed by a tax that they were never intended to pay. An increase of approximately $3,000 in tax payments for more than 20 million American homes would be disastrous for families already reeling from home foreclosures, high gas prices, and nearly stagnant wages. The bill’s tax credit increases and extensions, including credits for college tuition and for improving public schools in economically distressed areas, benefit current and aspiring middle-class families. The legislation also spares families who have lost their homes to foreclosure from large income tax bills that would result from their mortgage debts being voided. This provision provides relief for households engulfed by the housing crisis that would otherwise be subject to large tax bills even after losing their homes. The bill’s revenue-raising tax hikes target the appropriate group: extraordinarily wealthy hedge fund and private equity managers who have exploited loopholes in the tax code to avoid paying their fair share of taxes.

Finally, the Tax Relief Act’s prohibition of debt-collection contracts between the IRS and private companies, a ban suggested by the IRS’s taxpayer advocate, will put a stop to the harassment of lower- and middle-income taxpayers that resulted from the unaccountable, inefficient, and expensive outsourcing of a public function to the private sector.

Quotes from Experts

Beyond this Bill

Additional Resources

House AMT “Patch” Bill Is Fiscally Responsible from the Center on Budget and Policy Priorities

Tax Topics: Individual Alternative Minimum Tax from the Urban-Brookings Tax Policy Center

The Taxation of Carried Interest, Testimony before the Finance Committee of the U.S. Senate

Nina Olson, National Taxpayer Advocate, Statement on the IRS’s private debt collection inititative

Restore Pay-As-You-Go Tax Cut Amendment of 2004

atraub — Tue, 25 Sep 2007 13:38:46 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

2004 United States budget deficit: $413 billion
Increase over the size of the 2003 budget deficit: $35 billion
Amount U.S. taxpayers spent on interest on the federal debt in 2004: $159 billion
Estimated cost of the interest on the federal debt to the average middleclass household in 2004: $5,215
Cost of the Bush tax cuts over 10 years: $1.7 trillion
Number of times the federal debt limit has been raised in the past three years: 3
Number of tax cuts in the last four years: 5

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports: Pay-As-You-Go spending rules mandate fiscal responsibility: Congress must consider carefully before spending or giving away in the form of tax cuts money it doesn’t have. The 60-vote supermajority rule is intended to institutionalize this careful consideration. While deficit spending can provide needed economic stimulus during a recession, the unrestrained deficit-inducing tax cuts of the past few years were ill-considered, with little job creation to show for them. Instead, running deficits year after year has led to little more than ballooning debt and the need to repeatedly extend the federal debt limit. Middle-class families, threatened with increasingly dire consequences by bills like the Bankruptcy Abuse Prevention Act (see page 9) when they depart from a pay-as-you-go routine in their household finances, are made to bear the burden of the government’s fiscal irresponsibility. Down the line, a higher debt weakens the dollar and fosters inflation. If deficit spending provided sound investments and economic stimulus, inflation would not dramatically undercut the middle class. But in the absence of higher wages, inflation makes basic necessities harder for middle-class families to afford and threatens to lower the country’s standard of living.

Pay-go

Temporary Tax Relief Act of 2007

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

Restore Pay-As-You-Go Tax Cut Amendment of 2004

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources