Curtain falls on LTCG

[Snaggletoof]

I am somewhat confused about a capital gains transaction which occurs in 2010.

Capital Gains and Dividends rates are 15%, but I believe this expired on 12/31/09.
With respect to this, what would the "new" 2010 rates be?

Consider:

a) The 15% ceiling has been extended a couple times. Politically, not much chance of this happening again unless the 2010 elections so overwhelmingly favor Republicans that the ceiling will receive new life.
b) I have read that the administration wants the 15% ceiling to rise to 20%, not only for LTCG but for dividends as well. The "wishes" of politicians, however, need legislation for it to become law.
c) If the 15% ceiling was extended to 12/31/09 and dies a death right there without being extended, what do the rates become in 2010? Do they revert back to what they were prior to these ceilings? If so, LTCG ceiling would actually be 20%, and dividends would simply be ordinary income.

I would expect an immediate impact on the stock market if they tampered with the dividends ceiling.

[Gene V]

I am somewhat confused about a capital gains transaction which occurs in 2010.

Capital Gains and Dividends rates are 15%, but I believe this expired on 12/31/09.
With respect to this, what would the "new" 2010 rates be?

Consider:

a) The 15% ceiling has been extended a couple times. Politically, not much chance of this happening again unless the 2010 elections so overwhelmingly favor Republicans that the ceiling will receive new life.
b) I have read that the administration wants the 15% ceiling to rise to 20%, not only for LTCG but for dividends as well. The "wishes" of politicians, however, need legislation for it to become law.
c) If the 15% ceiling was extended to 12/31/09 and dies a death right there without being extended, what do the rates become in 2010? Do they revert back to what they were prior to these ceilings? If so, LTCG ceiling would actually be 20%, and dividends would simply be ordinary income.

I would expect an immediate impact on the stock market if they tampered with the dividends ceiling.

If I'm reading TTB 6-8 right
The Capital Gains Rates doesn't change until 2011

[Edsel]

Forecasting

I think there have been several blurbs in the press from people who claim to have a "pulse" on Washington's latest attempts to scramble the law.

Almost all of them say that the Obama administration and congress intend to rescind the 15% ceiling and replace it with a 20% ceiling, some of them claim they are likely to do so retroactive to 01/01/10. Others say there will be no ceiling on qualified dividends at all, other than ordinary income.

These things are helpful to know, but should not creep into our tax practice prior to the change being made. And who knows what will happen this fall with elections?

The Clinton administration was determined to bring about health care changes. Bill appointed his wife to head up the blue ribbon commission. Doctors and health care providers contributed to political campaigns as never before. A few of them even ran for office and were successful. The result was a Republican sweep in the 1994 elections. Hillary care was stopped dead in its tracks and was never revived. This could happen again with these grandiose tax plans.