| Friday, March 30, 2001
'Bastard' cut from Delaware code
A story released today by the Associated Press reports that a conservative Delaware
lawmaker argued on the House floor yesterday that referring to an out-of-wedlock child as
a "bastard" in state code was acceptable if it embarrassed unmarried couples
into not having children.
"We should recognize that a sense of shame throughout history has been a wonderful
corrective aspect of personal behavior," said Wayne Smith, the republican who also is
House majority leader.
"I do not mean to impugn the individuals who are in this situation," he said.
"I also feel very strongly that government ought not to sanction behavior, which I
think we can mostly agree, is less than desirable."
Despite Smith's argument, the bill deleting the word "bastard" breezed through
35-1, with five representatives absent.
Smith was the sole dissenter against the measure.
The bill would replace the word "bastard" with the phrase "non-marital
child" throughout state code.
Rep. Helene Keeley, D-Wilmington, who wrote the bill, said the phrase "non-marital
child" was preferred by the American Association of Single People, an organization
she said she worked with in drafting the bill.
Keeley said she wrote the bill because she was so upset that children were being openly
referred to as "bastards" in places like Family Court.
Other lawmakers supporting spoke in favor of adopting the legislation, noting that the
children labeled as bastards had little influence over the behavior of their parents.
"To me the term is a derogatory term and it is attached to the child," said Rep.
Bruce Reynolds, a Bear Republican. "I don't think it reflects the shame back to the
parent as much as to the child, who had no choice in the decision that was made - or the
lack of a decision that was made."
Smith defended his floor speech, urging votes against the measure.
"I see this attempt to destigmatize this term, change this term, eliminate this term
as perhaps giving up the battle of trying to describe the situation as something that is
less than ideal or that has a sense of shame," Smith said.
The legislation now heads to the Senate. Several senators already have signed on as
co-sponsors.
House passes bill reducing marriage
penalty for some, increasing marriage bonus for others
A story published today in the Los Angeles Times reports that the House on Thursday
approved a bill that would provide $400 billion in tax cuts over the next 10 years for
married couples and people with children.
In a rare show of bipartisanship in a chamber that has been bitterly divided over Bush's
budget and tax plans, the bill was approved, 282 to144, with 64 Democrats joining all
voting Republicans in support.
The bill aims to reduce the "marriage penalty," a quirk in the tax code that
forces almost half of all couples to pay more in taxes after they marry than if they had
remained single and filed individually.
But the bill goes far beyond addressing that anomaly, giving tax cuts to all married
couples--not just those hit by the penalty. It also includes provisions to gradually
double the $500-per-child tax credit that families now receive.
The family tax cuts are the second element of the Bush tax plan to clear the House.
Earlier this month, the House voted along party lines to approve across-the-board cuts in
income tax rates--the centerpiece of Bush's plan to reduce taxes by $1.6 trillion over10
years.
Next week, the House will vote on a bill to gradually eliminate the estate tax, another
element in Bush's plan. But, as approved by the House Ways and Means Committee, the
measure would phase out the tax more gradually than the president proposal. The bill would
also replace estate taxes with increased taxes on capital gains accrued when an heir sells
an inherited asset.
House GOP leaders made these adjustments in response to estimates showing that
implementing Bush's repeal would be prohibitively expensive. The focus of the bill passed
by the House is to reduce the marriage penalty, paid by about 42% of all joint filers.
The penalty hits hardest on two-earner families. An estimated 25 million married couples
pay an average of $1,400 more than if they had remained single. As a result, proponents of
the bill argued, the tax code provides a financial disincentive for couples to get
married.
As approved, the House bill would:
* Allow more of married couples' income to be taxed at the
bottom tax rate of 15%. It would do that by widening the 15% bracket so that it would
eventually be twice the size of the bracket for single taxpayers. This change would not be
fully implemented until 2009.
* Increase the standard deduction for couples so that it
would be twice the size of the deduction for single taxpayers.
* Raise the income threshold for low-income couples to
qualify for the earned income tax credit, which provides relief for working couples.
For families with children, the bill follows the Bush plan and would increase the child
credit from $500 now to $1,000 in 2006.
But the House bill would make the first step of the increase effective in 2001, instead of
2002, as Bush proposed.
The House rejected Bush's proposal to allow more upper-income people to qualify for the
credit by raising the eligibility income ceiling from $110,000 to $200,000 for married
couples.
The House bill also would increase relief to lower-income working families whose tax
liability is too low to take full advantage of the child credit. Under current law, such
families can receive refunds up to the amount they owe in payroll taxes if they have three
or more children. The House bill would allow those partial refunds to all families with
children.
The House version of the estate tax bill that comes up for floor debate next week would
provide $193 billion in relief over 10 years as compared to the $267-billion on Bush's
proposal.
The House bill costs less, in part, because it would not completely eliminate the estate
tax until 2011 which Bush wanted repealed by 2009.
Right now, only about 2% of people who die actually pay the estate tax because it applies
only to inheritances in excess of $675,000, a threshold that is scheduled to rise to $1
million later this decade. There has been strong bipartisan support for
reducing or repealing the estate tax because many farmers and small-business owners have
complained that heirs are forced to liquidate their inheritances in order to pay taxes
that reach as high as 55%.
In an important change from Bush's proposal , the House bill modified the way capital
gains are calculated when an heir sells an asset which would help reduce its cost. Under
current law, capital gains taxes are owed only on the difference between the value of an
asset at the time it was inherited and when it is sold.
The House bill would change that, calculating the capital gain of an inherited asset by
comparing its value at the time of sale to its value when the individual who died acquired
it--often many years earlier. That would mean an heir could face much larger capital gains
taxes when the asset is sold.
The bill would, however, exempt assets up to $1.3 million for any heir--and up to $4.3
million for a surviving spouse.
Thursday, March 29, 2001
Research indicates that profile of
U.S. single mom is changing
A story released today by Reuters Health reports that about one third of US children are
born out-of-wedlock, but the make up of this new American family is different from the
common public perception, researchers report.
National statistics indicate that only a minority of these births are to teenage mothers,
and that many single mothers are living with their babies' fathers.
In 1970, only 11% of children were born outside marriage, and half of these births were to
teenage mothers. By 1999, one in every three American children were born to single
parents, with teen moms accounting for fewer than 30% of these births, reports Child
Trends, a Washington, DC-based, non-profit research center.
Using data gathered from the National Center for Health Statistics, Elizabeth Terry-Humen
and her colleagues determined that out-of-wedlock births in the US grew rapidly during the
1970s and 1980s, then plateaued between 1994 and 1999.
The researchers also found that in 1999, women in their early 20's had the highest rate of
births outside of marriage. And more than one third of out-of-wedlock births were to women
older than 25. Additionally, the number of children born to parents who are living
together is has steadily increased. By 1994, 39% of out-of-wedlock births were to
cohabiting couples--up from 29% a decade earlier.
Another popular perception misconstrued by actual statistics, according to the authors, is
that out-of-wedlock births are a "racial and ethnic minority issue." For
instance, while the nonmarital birth rate remains higher among black women compared with
white women, the rate has more than doubled among whites since 1970, but declined by one
quarter among blacks, the report indicates.
"The increase in childbearing outside of marriage reflects a reduction in the
likelihood of marriage at all ages," according to Terry-Humen and her colleagues. The
researchers noted that the slow-down in out-of-wedlock births in the 1990s may be related
to economic growth, advances in contraception, welfare reforms targeting births to single
parents, and increased concern over HIV and other sexually transmitted diseases.
The researchers also point out that although the typical single mother has changed since
1970, statistics still indicate unmarried mothers are more likely to have low
incomes, and their children face a higher risk for poor school performance and for having
children outside of marriage themselves.
House tax cuts at a glance
A story released today by the Associated Press reports the elements of the10-year, $399
billion legislation that passed the House to reduce the marriage penalty and increase the
child tax credit and details of a bill approved by the House Ways and Means Committee that
would gradually eliminate the estate tax at a cost of $193 billion over 10 years.
On marriage penalty, the report notes that beginning 2002, the standard deduction for
married couples would be raised so that it is equal to twice that of single taxpayers. If
in effect this year, the deduction would be $9,100 instead of $7,600 for a married couple.
The families with two children who claim the earned income tax credit would get up to $401
more. Those with one child could get an additional $246. The maximum income level for
those claiming the credit is $32,121.
From 2004 to 2009, the bottom 15 percent tax bracket would be widened so it applies to
more of a married couple's income, equal to twice that of singles. If enacted this year,
the 15 percent bracket would apply to $54,100 of a couple's income, instead of $45,200
under current law.
Rules would be modified to prevent the tax cuts from forcing more couples to pay the
alternative minimum tax.
On child credit, the report indicated that the $500 child tax credit would rise to $600
retroactive to 2001, meaning taxpayers could claim the higher credit on tax returns if
they file by April 2002. The $600 credit would also apply in 2002. The credit would also
increase to $700 in 2003, $800 in 2004, $900 in 2005 and $1,000 in 2006 and later years.
On estate tax, the story stated that taxes would be reduced beginning in 2002 and repealed
fully by 2011. Once completely repealed, inherited assets would carry forward the value,
or basis, they had when the individual who died acquired them. Their heirs would owe
capital gains taxes on that increase in value if the assets are sold. Under current law,
the asset's basis begins for the heir when the individual dies.
The new rules regarding basis would not apply to the first $1.3 million of gain, or to the
first $4.3 million in gain if the heir is a surviving spouse.
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