Mark Kirk on Tax Reform

Republican Jr Senator; previously Representative (IL-10)

Ending Bush tax cuts may cause double-dip recession

Q: Do you think that the Bush-era tax cuts should be extended for all Americans?

KIRK: Congressional leaders want to hit the US economy with a $900 billion tax increase on Dec. 31. On top of the ten new taxes in the health care bill, on top of the taxe in financial regulation bill. The key danger here is will our policies increase the chance of a double-dip recession? Taking more money out of the private economy, I don't think it's the right way to go.

Q: Well, back in 2004, you were part of the Republican Main Street Partnership. As part of that group, you had a press release in which you said: "Tax cuts should only be extended temporarily.... We simply can't afford permanent and across-the-board extensions at this time". That's what you said then, when the debt was about 1/3 of what it was today. How could we afford to make permanent tax extensions now?

KIRK: Because especially in this climate, we have Congressional leaders that are not interested in spending restraint at all.

Source: NBC's Meet the Press: 2010 IL Senate debate , Oct 10, 2010

Tax increase is surest way to turn recession into depression

Mark Kirk continues to fight proposals to increase taxes on family farmers and small business owners--the surest way to turn a recession into a depression. He voted to permanently repeal the death tax, double the child tax credit, end the Alternative Minimum Tax and eliminate the marriage penalty. As Senator, Mark Kirk will continue fighting for lower taxes on small business owners and family farmers to spur investment and job growth. Source: 2010 Senate campaign website, kirkforsenate.com, "Issues" , Dec 25, 2009

End marriage penalty & death tax; simplify tax code

We must reform the tax code to make it fairer and simpler. We must also end the marraige tax penalty and eliminate the death tax. It doesn’t make sense for the tax code to penalize married couples by forcing them to pay, on average, $1,400 more than if they filed as individuals. Source: www.kirkforcongress.com , Sep 9, 2000

Voted YES on extending AMT exemptions to avoid hitting middle-income.

Congressional Summary: Amends the Internal Revenue Code to:

increase and extend through 2008 the alternative minimum tax (AMT) exemption amounts;
extend through 2008 the offset of personal tax credits against AMT tax liabilities;
treat net income and loss from an investment services partnership interest as ordinary income and loss;
deny major integrated oil companies a tax deduction for income attributable to domestic production of oil or gas.

Wikipedia.com Explanation: The AMT became operative in 1970. It was intended to target 155 high-income households that had been eligible for so many tax benefits that they owed little or no income tax under the tax code of the time. However, when Ronald Reagan signed the Tax Reform Act of 1986, the AMT was greatly expanded to aim at a different set of deductions that most Americans receive.

The AMT sets a minimum tax rate of 26% or 28% on some taxpayers so that they cannot use certain types of deductions to lower their tax. By contrast, the rate for a corporation is 20%. Affected taxpayers are those who have what are known as "tax preference items". These include long-term capital gains, accelerated depreciation, & percentage depletion.

Because the AMT is not indexed to inflation, an increasing number of upper-middle-income taxpayers have been finding themselves subject to this tax. In 2006, an IRS report highlighted the AMT as the single most serious problem with the tax code.

For 2007, the AMT Exemption was not fully phased until [income reaches] $415,000 for joint returns. Within the $150,000 to $415,000 range, AMT liability typically increases as income increases above $150,000.

OnTheIssues.org Explanation: This vote extends the AMT exemption, and hence avoids the AMT affecting more upper-middle-income people. This vote has no permanent effect on the AMT, although voting YES implies that one would support the same permanent AMT change.

Reference: Alternative Minimum Tax Relief Act; Bill H.R.6275 ; vote number 2008-455 on Jun 25, 2008

Voted NO on paying for AMT relief by closing offshore business loopholes.

H.R.4351: To provide individuals temporary relief from the alternative minimum tax (AMT), via an offset of nonrefundable personal tax credits. [The AMT was originally intended to apply only to people with very high incomes, to ensure that they paid a fair amount of income tax. As inflation occurred, more people became subject to the AMT, and now it applies to people at upper-middle-class income levels as well. Both sides agree that the AMT should be changed to apply only to the wealthy; at issue in this bill is whether the cost of that change should be offset with a tax increase elsewhere or with no offset at all. -- ed.]

Proponents support voting YES because:

Rep. RANGEL: We have the opportunity to provide relief to upward of some 25 million people from being hit by a $50 billion tax increase, which it was never thought could happen to these people. Almost apart from this, we have an opportunity to close a very unfair tax provision, that certainly no one has come to me to defend, which prevents a handful of people from having unlimited funds being shipped overseas under deferred compensation and escaping liability. Nobody, liberal or conservative, believes that these AMT taxpayers should be hit by a tax that we didn't intend. But also, no one has the guts to defend the offshore deferred compensation. So what is the problem?

Opponents recommend voting NO because:

Rep. McCRERY: This is a bill that would patch the AMT, and then increase other taxes for the patch costs. Republicans are for patching the AMT. Where we differ is over the question of whether we need to pay for the patch by raising other taxes. The President's budget includes a 1-year patch on the AMT without a pay-for. That is what the Senate passed by a rather large vote very recently, 88-5. The President has said he won't sign the bill that is before us today. Republicans have argued against applying PAYGO to the AMT patch. In many ways PAYGO has shown itself to be a farce.

Reference: AMT Relief Act; Bill HR4351 ; vote number 2007-1153 on Dec 12, 2007

Voted YES on retaining reduced taxes on capital gains & dividends.

Vote to reduce federal spending by $56.1 billion over five years by retaining a reduced tax rate on capital gains and dividends, as well as.

Decreasing the number of people that will be required to pay the Alternative Minimum Tax (AMT)
Allowing for deductions of state and local general sales taxes through 2007 instead of 2006
Lengthening tax credits for research expenses
Increasing the age limit for eligibility for food stamp recipients from 25 to 35 years
Continuing reduced tax rates of 15% and 5% on capital gains and dividends through 2010
Extending through 2007 the expense allowances for environmental remediation costs (the cost of cleanup of sites where petroleum products have been released or disposed)

Reference: Tax Relief Extension Reconciliation Act; Bill HR 4297 ; vote number 2005-621 on Dec 8, 2005

Voted YES on providing tax relief and simplification.

Working Families Tax Relief Act of 2004

Extension of Family Tax Provisions
Repeals the scheduled reduction (15 to 10 percent) for taxable years beginning before January 1, 2005, of the refundability of the child tax credit.
Extends through 2005 the increased exemption from the alternative minimum tax for individual taxpayers.
Extends through 2005 the following expiring tax provisions:
1. the tax credit for increasing research activities;
2. the work opportunity tax credit;
3. the welfare-to-work tax credit;
4. the authority for issuance of qualified zone academy bonds;
5. the charitable deduction for donations by corporations of computer technology and equipment used for educational purposes;
6. the tax deduction for certain expenses of elementary and secondary school teachers;
7. the expensing of environmental remediation costs;
8. the designation of a District of Columbia enterprise zone

Reference: Bill sponsored by Bill Rep Thomas [R, CA-22]; Bill H.R.1308 ; vote number 2004-472 on Sep 23, 2004

Voted YES on making permanent an increase in the child tax credit.

Vote to pass a bill that would permanently extend the $1,000 per child tax credit that is scheduled to revert to $700 per child in 2005. It would raise the amount of income a taxpayer may earn before the credit begins to phase out from $75,000 to $125,000 for single individuals and from $110,000 to $250,000 for married couples. It also would permit military personnel to include combat pay in their gross earnings in order to calculate eligibility for the child tax credit. Reference: Child Credit Preservation and Expansion Act; Bill HR 4359 ; vote number 2004-209 on May 20, 2004

Voted YES on permanently eliminating the marriage penalty.

Vote to pass a bill that would permanently extend tax provisions eliminating the so-called marriage penalty. The bill would make the standard deduction for married couples double that of single taxpayers. It would also increase the upper limit of the 15 percent tax bracket for married couples to twice that of singles. It also would make permanent higher income limits for married couples eligible to receive the refundable earned-income tax credit. Reference: Marriage Penalty Relief; Bill HR 4181 ; vote number 2004-138 on Apr 28, 2004

Voted YES on making the Bush tax cuts permanent.

Vote to pass a bill that would permanently extend the cuts in last year's $1.35 trillion tax reduction package, many of which are set to expire in 2010. It would extend relief of the marriage penalty, reductions in income tax rates, doubling of the child tax credit, elimination of the estate tax, and the expansion of pension and education provisions. The bill also would revise a variety of Internal Revenue Service tax provisions, including interest, and penalty collection provisions. The penalties would change for the failure to pay estimated taxes; waive minor, first-time error penalties; exclude interest on unintentional overpayments from taxable income; and allow the IRS greater discretion in the disciplining of employees who have violated policies. Reference: Bill sponsored by Lewis, R-KY; Bill HR 586 ; vote number 2002-103 on Apr 18, 2002

Voted YES on $99 B economic stimulus: capital gains & income tax cuts.

Vote to pass a bill that would grant $99.5 billion in federal tax cuts in fiscal 2002, for businesses and individuals.

The bill would allow more individuals to receive immediate $300 refunds, and lower the capital gains tax rate from 20% to 18%.

Bill HR 3090 ; vote number 2001-404 on Oct 24, 2001

Voted YES on Tax cut package of $958 B over 10 years.

Vote to pass a bill that would cut all income tax rates and make other tax cuts of $958.2 billion over 10 years. The bill would convert the five existing tax rate brackets, which range from 15 to 39.6 percent, to a system of four brackets with rates of 10 to 33 percent. Reference: Bill sponsored by Thomas, R-CA; Bill HR 1836 ; vote number 2001-118 on May 16, 2001

Voted YES on eliminating the Estate Tax ("death tax").

Vote to pass a bill that would gradually reduce revenue by $185.5 billion over 10 years with a repeal of the estate tax by 2011. Reference: Bill sponsored by Dunn, R-WA; Bill HR 8 ; vote number 2001-84 on Apr 4, 2001

Phaseout the death tax.

Kirk co-sponsored the Death Tax Elimination Act:

Title: To amend the Internal Revenue Code of 1986 to phaseout the estate and gift taxes over a 10-year period.

Summary:

property shall be treated as transferred by gift; and
the basis of the person acquiring the property shall be the lesser of the adjusted basis of the decedent or the fair market value of the property at the date of the decedent's death.
Requires specified information to be reported concerning non-cash assets over $1.3 million transferred at death and certain gifts exceeding $25,000.
Makes the exclusion of gain on the sale of a principal residence available to heirs.
Revises current provisions concerning the transfer of farm real to provide that gain on such exchange shall be recognized to the estate only to the extent that the fair market value of such property exceeds such value on the date of death.
Provides a similar rule for certain trusts.
Amends the special rules for allocation of the generation-skipping tax (GST) exemption to provide that if any individual makes an indirect skip during such individual's lifetime, any unused portion of such individual's GST exemption shall be allocated to the property transferred to the extent necessary to make the inclusion ratio for such property zero; and
if the amount of the indirect skip exceeds such unused portion, the entire unused portion shall be allocated to the property transferred.
Provides that, if an allocation of the GST exemption to any transfers of property is deemed to have been made at the close of an estate tax inclusion period, the value of the property shall be its value at such time.

Source: House Resolution Sponsorship 01-HR8 on Mar 14, 2001

Rated 58% by NTU, indicating "Satisfactory" on tax votes.

Kirk scores 58% by NTU on tax-lowering policies

Every year National Taxpayers Union (NTU) rates U.S. Representatives and Senators on their actual votes—every vote that significantly affects taxes, spending, debt, and regulatory burdens on consumers and taxpayers. NTU assigned weights to the votes, reflecting the importance of each vote’s effect. NTU has no partisan axe to grind. All Members of Congress are treated the same regardless of political affiliation. Our only constituency is the overburdened American taxpayer. Grades are given impartially, based on the Taxpayer Score. The Taxpayer Score measures the strength of support for reducing spending and regulation and opposing higher taxes. In general, a higher score is better because it means a Member of Congress voted to lessen or limit the burden on taxpayers. The Taxpayer Score can range between zero and 100. We do not expect anyone to score a 100, nor has any legislator ever scored a perfect 100 in the multi-year history of the comprehensive NTU scoring system. A high score does not mean that the Member of Congress was opposed to all spending or all programs. High-scoring Members have indicated that they would vote for many programs if the amount of spending were lower. A Member who wants to increase spending on some programs can achieve a high score if he or she votes for offsetting cuts in other programs. A zero score would indicate that the Member of Congress approved every spending proposal and opposed every pro-taxpayer reform.

Source: NTU website 03n-NTU on Dec 31, 2003

Rated 17% by the CTJ, indicating opposition to progressive taxation.

Kirk scores 17% by the CTJ on taxationissues

OnTheIssues.org interprets the 2005-2006 CTJ scores as follows:

0% - 20%: opposes progressive taxation (approx. 235 members)
21% - 79%: mixed record on progressive taxation (approx. 39 members)
80%-100%: favors progressive taxation (approx. 190 members)

About CTJ (from their website, www.ctj.org):

Citizens for Tax Justice, founded in 1979, is not-for-profit public interest research and advocacy organization focusing on federal, state and local tax policies and their impact upon our nation. CTJ's mission is to give ordinary people a greater voice in the development of tax laws. Against the armies of special interest lobbyists for corporations and the wealthy, CTJ fights for:

Fair taxes for middle and low-income families
Requiring the wealthy to pay their fair share
Closing corporate tax loopholes
Adequately funding important government services
Reducing the federal debt
Taxation that minimizes distortion of economic markets

Source: CTJ website 06n-CTJ on Dec 31, 2006

Taxpayer Protection Pledge: no new taxes.

Kirk signed Americans for Tax Reform "Taxpayer Protection Pledge"

Politicians often run for office saying they won't raise taxes, but then quickly turn their backs on the taxpayer. The idea of the Pledge is simple enough: Make them put their no-new-taxes rhetoric in writing.

In the Taxpayer Protection Pledge, candidates and incumbents solemnly bind themselves to oppose any and all tax increases. While ATR has the role of promoting and monitoring the Pledge, the Taxpayer Protection Pledge is actually made to a candidate's constituents, who are entitled to know where candidates stand before sending them to the capitol. Since the Pledge is a prerequisite for many voters, it is considered binding as long as an individual holds the office for which he or she signed the Pledge.

Since its rollout with the endorsement of President Reagan in 1986, the pledge has become de rigeur for Republicans seeking office, and is a necessity for Democrats running in Republican districts.

Source: Americans for Tax Reform "Taxpayer Protection Pledge" 10-ATR on Aug 12, 2010

Opposes both marriage penalty & federal tax increases.

Kirk opposes the CC survey questions on increasing taxes

The Christian Coalition voter guide [is] one of the most powerful tools Christians have ever had to impact our society during elections. This simple tool has helped educate tens of millions of citizens across this nation as to where candidates for public office stand on key faith and family issues.

Increase in federal income tax rates
Elimination of the federal marriage tax penalty [vs. keeping the federal marriage tax penalty]

Source: Christian Coalition Survey 10-CC-q11 on Aug 11, 2010

Supports the Taxpayer Protection Pledge.

Kirk signed the Taxpayer Protection Pledge against raising taxes

[The ATR, Americans for Tax Reform, run by conservative lobbyist Grover Norquist, ask legislators to sign the Taxpayer Protection Pledge in each election cycle. Their self-description:]

In the Taxpayer Protection Pledge, candidates and incumbents solemnly bind themselves to oppose any and all tax increases. Since its rollout in 1986, the pledge has become de rigeur for Republicans seeking office, and is a necessity for Democrats running in Republican districts. Today the Taxpayer Protection Pledge is offered to every candidate for state office and to all incumbents. More than 1,100 state officeholders, from state representative to governor, have signed the Pledge.

The Taxpayer Protection Pledge: "I pledge to the taxpayers of my district and to the American people that I will: ONE, oppose any and all efforts to increase the marginal income tax rate for individuals and business; and TWO, oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates."

Opponents' Opinion (from wikipedia.com):In Nov. 2011, Sen. Harry Reid (D-NV) claimed that Congressional Republicans "are being led like puppets by Grover Norquist. They're giving speeches that we should compromise on our deficit, but never do they compromise on Grover Norquist. He is their leader." Since Norquist's pledge binds signatories to opposing deficit reduction agreements that include any element of increased tax revenue, some Republican deficit hawks now retired from office have stated that Norquist has become an obstacle to deficit reduction. Former Republican Senator Alan Simpson, co-chairman of the National Commission on Fiscal Responsibility and Reform, has been particularly critical, describing Norquist's position as "no taxes, under any situation, even if your country goes to hell."

Source: Taxpayer Protection Pledge 12-ATR on Jan 1, 2012

Implement socially fair, broad-based tax cuts.

Kirk adopted the Republican Main Street Partnership issue stance:

Not only has the Republican-led Congress achieved a balanced budget for the first time since 1969, but it has also created a budget surplus -- a feat not previously even imaginable. It is currently projected that the Fiscal Year 1999 budget surplus will be along the order of some $80 billion, of which $66 billion is earmarked for Social Security. This envious state of affairs would seem to indicate that equitable, far-reaching tax reductions may be in order -- not as an ideological or political strategy, but as a primary element of an economic growth policy and a legitimate tool for holding down unnecessary government growth in times of surplus.

The United States is enjoying steady economic prosperity thanks in no small measure to prudent fiscal policies implemented by the Republican-led Congress. However, we must look not only at the positive side of the economy but also at the problems the economy faces -- at the present time and into the twenty-first century. Limiting government spending (i.e., spending caps) is a good beginning to address some difficulties. In addition, current and future Congresses should maintain a balanced federal budget, pay down the national debt (which will help protect Social Security for current and future generations), redefine the federal government's role in the society and, finally, think about fair tax reductions for the American people and the businesses that drive our economy. [We need] an evaluation of implementing tax cuts based on their social fairness.

Source: Republican Main St. Partnership Issue Paper: Fiscal Policy 98-RMSP6 on Sep 9, 1998

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