Tax Cuts Extended and New Tax Incentives Signed Into Law

On December 17, 2010, the President signed into law the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the "Act"), which preserves the 2001 and 2003 tax cuts through 2012, renews the alternative minimum tax patch for 2010 and 2011, cuts the estate tax to 35 percent and allows a $5 million individual exemption, and cuts Social Security payroll taxes by 2 percentage points.

The Act also renews several other incentives – including the research and development credit and a 100% exclusion on gain from the sale of small business stock – that either expired at the end of 2009 or were scheduled to end in 2010. Several of the most noteworthy provisions in the Act are discussed below.

John Chase and Elizabeth Crouse

Full Act Information: https://clients.dorsey.com/rs/vm.ashx?ct=24F76A1CD5EA0AEDC1D089A5D52B931ADFBE7BB3D38714DD4CF371647BF8D90DDD78035