[Congressional Record Volume 155, Number 182 (Monday, December 7, 2009)]
[Extensions of Remarks]
[Page E2898]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




PERMANENT ESTATE TAX RELIEF FOR FAMILIES, FARMERS, AND SMALL BUSINESSES 
                              ACT OF 2009

                                 ______
                                 

                               speech of

                            HON. IKE SKELTON

                              of missouri

                    in the house of representatives

                       Thursday, December 3, 2009

  Mr. SKELTON. Mr. Speaker, nearly all American families do not qualify 
for the Federal estate tax. In fact, under the law as currently written 
in 2009, 99.75 percent of estates are exempt.
  The Federal estate tax has been amended many times through the 
years--most recently in 2001 as part of the Republicans' omnibus tax 
cut legislation. That measure gradually increased estate tax exemptions 
and lowered estate tax rates between 2001 and 2009.
  In 2002, people with estates valued less than $1 million ($2 million 
for joint filers) after deductions for expenses, debts, and bequests to 
a surviving spouse or charity were exempt from paying the Federal 
estate tax. Those with estates above that value were taxed at a rate of 
55 percent.
  In 2009, people with estates valued less than $3.5 million ($7 
million for joint filers) after deductions for expenses, debts, and 
bequests to a surviving spouse or charity are exempt from paying the 
Federal estate tax. Those with estates above that value are taxed at a 
rate of 45 percent.
  The 2001 tax law phases out the federal estate tax in 2010 but then 
reinstates the tax in 2011 at the level it was in 2002--$1 million for 
single filers and $2 million for those filing a joint return. This 
fluctuation in estate tax rates has caused a great deal of confusion 
for business owners and farmers who are participating in estate 
planning. In order to provide more certainty to those individuals, the 
Congress has been working to set a permanent estate tax rate that would 
exempt nearly all but the very wealthiest Americans.
  Through the years, I have voted to eliminate the estate tax or to 
maintain suitably high exemptions to better shield farmers and small 
business owners from the burdens of the tax. This year, I cosponsored 
H.R. 3905, bipartisan legislation written by Congresswoman Shelley 
Berkley (D-NV) that would permanently exempt estates valued at less 
than $5 million for single filers and $10 million for joint filers and 
set the tax rate on estates valued above that amount at 45 percent on a 
decreasing scale to 35 percent over the next ten years.
  I have also cosponsored H.R. 3524, the Family Farm Preservation and 
Conservation Estate Tax Act, which was introduced by Congressman Mike 
Thompson. This legislation would add a provision to the federal tax 
code allowing farmers and ranchers to defer payment of the Federal 
estate tax as long as the land is owned within the family and remains 
in agricultural production. H.R. 3524 would also defer the tax for land 
placed into a conservation easement. The measure would represent a win 
for farmers, for conservation and hunters, and for all of rural 
America. That is why it is supported by groups like the National 
Cattlemen's Beef Association, the National Corn Growers Association, 
the National Council of Farmer Cooperatives, the National Milk 
Producers Federation, the National Pork Producers Council, the Dairy 
Farmers of America, and the Agricultural Retailers Association.
  While I would have preferred the House of Representatives to consider 
one of these well-written bills, the House of Representatives has 
considered a different measure, H.R. 4154, the Permanent Estate Tax 
Relief for Families, Farmers, and Small Businesses Act of 2009, which 
would permanently extend the estate tax levels at the current, 2009 
rates.
  It is very important for families, farmers, and businesses to have 
greater certainty with respect to estate planning. Groups representing 
a good number of Missourians expressed to me their views on this issue. 
The Dairy Farmers of America, which represents nearly 18,000 dairy 
producers in America, urged Congress to ``take action now on this 
important measure'' and to ``support H.R. 4154.'' The American Farm 
Bureau Federation, while neutral on the bill, indicated the ``need for 
certainty in estate tax law and the importance of maintaining the 
stepped-up basis.'' And, the U.S. Chamber of Commerce, the world's 
largest business federation representing more than three million 
businesses and organizations, wrote that Congress should 
``expeditiously approve a permanent estate tax solution to provide 
certainty for family-owned businesses and farms.'' The Chamber further 
indicated that ``H.R. 4154, the `Permanent Estate Tax Relief for 
Families, Farmers, and Small Businesses Act of 2009,' is a step towards 
this goal.''
  As a rural Missouri Congressman, I understand that farms and small 
businesses are disproportionately impacted by the Federal estate tax. 
That is why I supported H.R. 4154. Under the 2009 estate tax 
guidelines, nearly all small businesses and farms are exempt from 
paying the tax. Only a small fraction of all estates in America--
9,600--are expected to owe Federal estate taxes in 2009. For farmers, 
USDA data indicate that, after deductions, approximately 554 farm 
estates throughout our Nation would be considered taxable.
  We should strive to reduce the number of farms and small businesses 
that are subject to the Federal estate tax. As I have mentioned, I have 
cosponsored legislation to do just that. And, to make clear my view 
that we should strive for higher tax exemptions, I was one of only 21 
Democrats to vote with Republicans against the Rule to consider H.R. 
4154 in the House of Representatives and was one of only 18 Democrats 
to vote with Republicans to send H.R. 4154 back to the Ways and Means 
Committee so that it could be improved.
  At the end of the day, though, both of those procedural votes failed 
and we were left with two choices--either pass a bill to give farmers 
and small business owners more certainty or sit back and do nothing, 
which would allow the rates to become more painful to farmers and small 
business owners over the next 2 years. To me, that choice was easy. 
H.R. 4154 is a step in the right direction and I look forward to 
working with the Senate on this important legislation.

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