Congressman Simpson today urged congressional leadership to act promptly to prevent a dramatic increase in the estate tax.  Without congressional action, the estate tax, which has been phased out over the past nine years, will come back in full force on January 1, 2011.  As a result, families who hope to pass down the family farm, ranch, or small business will face a crippling tax.

In January, the estate taxes are set to be reinstated at a $1 million exemption with a top rate of 55 percent.  The letter, which was signed by members of the Congressional Caucus on Beef, urges leaders to act quickly to ensure that any estate tax that is reinstated next year will have a higher exemption level that is indexed for inflation and a lower tax rate.  The members also advocate for a tax deferral for land that stays in agriculture production.

“In many cases, families are forced to sell assets in order to pay the estate tax,” the letter states.  “Families have been left guessing on the ever-changing rules when attempting to make plans for the future of their businesses. We believe that clear policy direction is needed to ensure that farmers and ranchers around the nation are able to make sound planning decisions for the future.”

Simpson is a cosponsor of legislation to make permanent the repeal of the death tax.