Feds may withhold 3% from contractors' pay

摘要

Unless Congress enacts legislation to repeal a provision inserted inrnunrelated tax legislation from 2005, any entity, including contractors, performing service at any level of government will experience the worst New Year's hangover ever as 3% will be withheld from payment, beginning in 2011. And this 3% withholding provision only adds to the possibility of increased taxation as the estate tax, which will tax the heirs of deceased business owners with a 55% tax hit for those estates valued at greater than $ 1 million.