The Senate Finance Committee and the House Ways and Means Committee hold a joint hearing on capital gains taxation proposals and tax reform.
Currently, the maximum capital gains tax rate is 15 percent, while the maximum individual income tax rate is 35 percent. Absent Congressional action, on January 1, 2013 the maximum statutory capital gains rate will increase to 20 percent and the maximum individual income tax rate will increase to 39.6 percent.
Also beginning in 2013, an additional 3.8 percent tax will be imposed on net investment income earned by certain individuals. Additionally, the scheduled 2013 restoration of the “Pease limitation” on itemized deductions will impose a roughly 1.2 percent marginal rate on capital gains, bringing the top federal rate on capital gains to 25 percent.
“It has been more than 25 years since the last major tax reform occurred. The world has changed drastically in that time and America’s tax code hasn’t kept up. It’s time we had a tax code for the 21st century, one that can create jobs, spark innovation and expand opportunity," Chairman of the Senate Finance Committee Sen. Max Baucus (D-MT) said.
House Ways and Means Committee Chairman Dave Camp (R-MI) said that this is the third time the two committees, who are both pursuing tax reform, have held a joint hearing.
Witnesses include: David H. Brockway, partner, Bingham McCutchen LLP; Lawrence B. Lindsey, president and CEO, The Lindsey Group; Leonard E. Burman, professor of public affairs, Syracuse University; David L. Verrill, founder, Hub Angels Investment Group LLC; and William D. Stanfill, general partner, Montegra Capital Income Fund.