With the Nov. 6 general election just a few weeks away, one thing is certain: Regardless of who wins, this Congress must address a long list of major issues before the new Congress convenes in January 2013. Consequently, incumbent members will need to meet one last time in a lame-duck session that will begin after the election and continue through December.
A lame-duck session is necessary to address year-end deadlines for such issues as Bush-era tax rates, which, if not extended, will default to higher rates. These would include marginal rates, capital gains and dividend rates, as well as the marriage penalty and child tax credit. In addition, the estate-tax formula with a $5 million exemption and maximum 35 percent rate will default back to a $1 million exemption with a top rate of 55 percent. If Congress fails to extend these rates, even temporarily, it could have a staggering effect on the economy and risk another recession.
This Congress also must renew the annual "patch" on the alternative minimum tax to spare millions of middle-class taxpayers from paying higher taxes, as well as the "doc fix" for payments to physicians who participate in Medicare and would otherwise sustain a 27 percent cut. In addition, the U.S.' debt limit might have to be raised again from its current $16.4 trillion ceiling so the federal government can continue selling bonds.