Winston Churchill
In a Bloomberg News story appearing November 5th, the dots are finally being connected between spending programs on one hand and the need for additional federal revenues on the other. See here.
The U.S. government is spending $787 billion to stimulate the economy, the deficit is $1.4 trillion and Congress is debating costly changes to health care. The taxpayers’ bill to pay for it isn’t far behind.
“Something is going to have to be done to raise revenue unless entitlement spending is cut,” said Gerald Prante, senior economist for the Washington-based Tax Foundation.
While the final resolution of the competing aims is being debated, what is under discussion has pundits opining that Federal tax rates may rise in 2011 to as high as 39.6 percent, up from 35 percent (for those earning more than $373,650). The House version of the health reform bill sets an additional 5.4 percent surtax on adjusted gross income for high- income individuals. Long-term capital gains rates may reach 28 percent, from 15 percent today, Prante said.
Tax advisers intend advising clients to take advantage of lower rates and expiring tax breaks on 2009 and 2010 returns, a tactic that could save millions for clients in the top brackets. Strategies range from investing in film production, deferring large-scale expenses into future years, investing in energy credits, to exercising non-qualified stock options.
“For many of our clients, particularly those who run their own businesses, there may be an opportunity to accelerate significant amounts of income -- even as much as $50 million to $100 million of taxable income,” said Mark Nash, a Dallas partner at New York-based PricewaterhouseCoopers Private Company Services, whose average client has assets of $150 million or more. The tax savings from moving income into 2009 or 2010 would be 4.6 percent of that amount, he said.
To me this just says "It's coming". The whole article is worth a read.
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