Tax changes are starting to shape up for the new year!
This entry was posted on 2/1/2007 8:25 AM and is filed under Tax News.
Congress works on small business tax incentives and our President talks about health care
2007 is shaping up to be a busy year for federal tax legislation during which taxpayers must keep informed and be prepared to take advantage immediately of new or expanded tax benefits. You need to be attentive to a growing list of "revenue raisers" being proposed both on a Federal and State level. These hidden taxes will be needed to pay for some of the tax cuts in other areas. The adage, "Congress giveth and Congress taketh away" appears to describe this year's balanced-budget activities on Capitol Hill.
After just one month of work, the new 110th Congress is set to raise the federal minimum wage; but the big question is whether it will give small businesses some tax breaks to help absorb the cost of higher wages. Democrats in the House want a "clean" minimum wage bill, raising the minimum wage to $7.25 over two years. In the Senate, where Democrats have a very narrow majority, many lawmakers support adding business tax breaks to the minimum wage bill. At press time, the total outcome is still uncertain. If the small business tax breaks don't make it into the minimum wage package now there will be pressure to continue to insert those provisions in other pending tax bills in the future.
Additionally, the House has also repealed some energy tax breaks and President Bush has proposed tax reforms to expand health insurance coverage. Two powerful tax writing committees, the House Ways and Means Committee and the Senate Finance Committee, are getting down to work and a slew of other tax bills have been introduced in Congress.
