Congressman Charles B. Rangel proudly stood with fellow Democratic members of the House in passing legislation that would permanently extend middle-class tax cuts that will help the vast majority of struggling Americans and spur economic growth.
"Today's bill helps provide tax relief for millions of working class and middle class Americans. It asks those with higher incomes to show generosity for the good of the nation," said Rangel. "We still need to do more to get this economy and our communities back on track, but it certainly points us in the right direction."
The Middle Class Tax Relief Act of 2010 passed by the House includes keeping tax rates at its current levels for families making less than $250,000 a year. It also permanently extends marriage penalty relief, the current amount of the Earned Income Tax Credit, capital gains and dividends rates, and $1,000 child tax credit (for earnings above $3,000). The bill will protect more than 25 million taxpayers from the alternative minimum tax by extending the AMT patch through 2011. It will permanently extend small business expensing. (Click here for estimated revenue effects provided by the non-partisan Joint Committee on Taxation.)
The bill, an amendment to the Senate Amendment to H.R. 4853, will expire Bush-era tax cuts for the nation's wealthiest three percent to the same levels that existed during the nation's last economic boom in the 1990s. It saves about $700 billion that would have been otherwise added to the nation's ballooning deficit.
Experts estimate that the typical middle class family could save approximately $1,000 per year. The vast majority of small businesses (97%) will also continue to see benefits. Hedge fund managers, investors, and super-wealthy individuals that file as S Corporations or partnerships will not.
"There is no doubt that we need to reform the tax code in this country. I look forward to working with my colleagues next Congress to create a fairer and more efficient system," said Rangel. "What we need is target relief that spurs consumer spending, job growth. You don't do that now by pushing for a tax break that's not paid for, to those who neither need it nor asked for it."