While Tuesday’s election produced significant gains for Republicans, the future of the Bush tax cuts is unlikely to be resolved any time soon, creating continued uncertainty for investors, according to Milwaukee-based Robert W. Baird & Co. Inc. wealth management experts.
Newly elected officials who may have campaigned on the issue will not take office until January, and those still holding office who return to Washington for a lame-duck session are unlikely to have the motivation or time to pass legislation extending the 2001 and 2003 tax cuts, which are scheduled to expire Dec. 31, according to Baird experts.
"Virtually all taxpayers should plan for higher federal income taxes in early 2011, while continuing to monitor the situation and its implications closely," said Timothy M. Steffen, CPA, CFP, financial and estate planning manager for Baird’s Private Wealth Management group. "We anticipate that the Bush-era tax cuts will be allowed to expire next month and would not be surprised if legislative changes are a long time in the making. We do expect any eventual changes to be made retroactive to the first of the year."
– BizTimes Milwaukee
