Congress Passes Tax Relief Act of 2010

On December 6th, President Obama and GOP leaders agreed to the framework of the Tax Relief, Unemployment Insurance Reauthorization and Jobs Creation Act of 2010 (Tax Relief Act of 2010) to extend Bush-era tax cuts which were originally due to expire on December 31, 2010. In an expected move on the evening of December 16th, the U.S. House of Representatives voted in favor of the bill after the Senate gave its approval earlier in the week. The bill will now be sent to the President to be signed into law.

As you may already be aware, the 2010 Tax Relief Act would extend individual and capital gains/dividend tax cuts for all taxpayers for an additional two years. The bill also provides for:

One-year payroll tax cut
100% bonus depreciation through 2011 and 50% bonus depreciations for 2012
Extenders tax relief
AMT "patch"
Top federal estate tax rate of 35% with a $5 million exclusion

For a full analysis of this bill, click here to view a recent article from the Journal of Accountancy. If you have any questions about the Tax Relief Act of 2010 or would like to discuss how it impacts your personal situation, please do not hesitate to contact the tax professionals at Watkins Uiberall at 901.761.2720.