Washington Report 072008

Date Published: 
Original Author: 
Robert M. Fells
Original Publication: 
ICCFA Magazine

ICCFA participates in briefing by President Bush to promote tax cuts

On June 2, the ICCFA participated in an economic briefing convened at the White House regarding the expiring "Bush tax cuts" that lowered tax rates beginning in 2001 and 2003. The cuts included repeal of the estate tax from 55 percent to zero.
These rate reductions will expire at the end of 2010, including restoration of the estate tax, unless Congress approves an extension or makes the tax cuts permanent. The ICCFA was represented by Bob Fells, external chief operating officer and general counsel. Near the conclusion of the briefing, President Bush unexpectedly joined the meeting and discussed the importance of maintaining the tax rate reductions.
(To view President Bush's remarks, go to the White House Web page at www.whitehouse.gov/news/releases/2008/06/20080602-2.html.)
Data offered in support of cuts
Among the financial data presented, the following highlight some areas of concern. If the 2001 and 2003 tax cuts expire in 2010:
  • 27 million small business owners will face an average tax increase of $4,066;
  • 18 million seniors will face an average tax increase of $2,181;
  • 12 million single women with dependents will face an average tax increase of $1,091;
  • 48 million married couples will face an average tax increase of $3,007, due in part to the restoration of the "marriage penalty" tax;
A typical family of four earning $50,000 will face a tax increase of more than $2,100.
The briefing was convened by the Council of Economic Advisors and the National Economic Council, which limited invitations to approximately 150 members of the Tax Relief Coalition. ICCFA was apparently the only organization in attendance that represented the funeral and cemetery professions.
Key findings of the National Economic Council:
1. The 2001 and 2003 tax cuts have substantially reduced the tax burden on labor and capital income, thereby increasing the rewards from working, saving and investing; and
2. If the tax cuts were made permanent and financed by reductions in government spending, long-run economic output could be expected to increase substantially.
Due to the tax cuts, the individual income tax rate is highly progressive. For example, in 2005, the top 5 percent of taxpayers paid more than one-half (59.7 percent) of all individual taxes, and the top 1 percent paid 39.4 percent. Taxpayers who rank in the top 50 percent of taxpayers by income pay virtually all individual income taxes. In 2005, they paid 96.9 percent of all individual income taxes.
Business owners also have benefited from the tax cuts. Approximately 70 percent or 1 million of the 1.4 million tax returns that benefit from lowering the top two tax brackets from 39.6 percent to 35 percent, and from 36 percent to 33 percent, are flow-through business owners.
A number of informational handouts were provided at the June 2 White House briefing. To view these and other relevant documents, go to www.taxreliefcoalition.org.

VA announces 'Second Headstone' policy 

On May 13, the U.S. Department of Veterans Affairs amended policy so that a government-furnished headstone or marker may be provided for a veteran's grave even if it is located in a private cemetery and is already marked.
Previously, the VA could not provide a marker in cases where the grave already had one. This "Second Headstone" policy is now permanent and also retroactive to eligible veteran deaths occurring on or after November 1, 1990, when Congress abolished the marker cash allowance benefit.
The announcement points out that the "VA does not pay the cost to install a government headstone or marker in a private cemetery, nor does VA have jurisdiction over policies established by private cemeteries."
"Therefore, the applicant must obtain certification on VA Form 40-1330 from a cemetery representative that the type and placement of the government-furnished headstone or marker requested adheres to the policies and guidelines of the private cemetery where the grave is located."