March 22, 2010 – As you know, the House has been focusing intensely on preparations for yesterday’s historic passage of both the Senate and reconciliation health care reform bills. The bill previously passed by the Senate is on its way to the President’s desk for his signature, while the reconciliation measure is expected to be the subject of Senate consideration beginning tomorrow through the remainder of the week.
Meanwhile estate tax reform continues to be discussed on the periphery. The Ways and Means Committee’s “Small Business and Infrastructure Jobs Tax Act” (HR 4849), which includes a provision limiting the usefulness of grantor-retained annuity trusts (GRATs), has not yet been scheduled for House floor time. However, we are carefully monitoring the situation and continuing to relate both our substantive concerns and opposition to the inclusion of estate tax revenue raisers in legislation unrelated to the estate tax. In addition to increasing the minimum term for GRATs to 10 years, the provision would also require that the remainder interest be greater than zero and stipulate that the annuity must not decrease during the first 10 years.
On the other side of the Hill, Senator Jon Kyl (R-AZ), the architect of the 35% rate and $5 million exemption proposal with Senator Blanche Lincoln (D-AR), insisted that Congress must act as quickly as possible and preferably before Memorial Day.