No agreement yet on extending estate tax: Hoyer

Democratic leaders in Congress have not yet reached an agreement to extend the estate tax before it expires at the end of the year, House Democratic Leader Steny Hoyer said on Tuesday.
Barack Obama

Lawmakers had hoped to ensure that the estate tax rate stay at 45 percent by attaching it to a must-pass defense spending bill, Hoyer said.

"We're working on that," Hoyer said at a news conference. "The estate tax is currently under discussion."

The tax, which applies to estates valued at more than $3.5 million, is due to disappear at the end of 2009 due to a quirk in the law before rising to 55 percent in 2011 on assets above $1 million.

The House voted on December 3 to permanently extend current policy, but the Senate has not acted because the debate over healthcare reform has monopolized the upper chamber's attention.

If lawmakers fail to act, the tax could disappear entirely for a year. That might be acceptable to liberal Democrats, who anticipate the higher rates of 2011, as well as to conservative Republicans, who want to eliminate the tax permanently.