2nd UPDATE:US Sen Panel Adds AMT Protections To Recovery Bill
2009年1月28日 - 8:20AM
Dow Jones News
Senate Finance Committee members agreed to add a $70 billion
provision to protect most middle-income taxpayers from the
alternative minimum tax in 2009 to economic stimulus
legislation.
The addition of the AMT "patch" brings the cost of tax
provisions in the Senate stimulus bill to $342 billion over 10
years. It would push the cost of the overall Senate package above
$900 billion.
Committee members agreed by voice-vote to add the AMT amendment,
offered simultaneously by both by Sen. Charles Grassley, R-Iowa,
and Sen. Robert Menendez, D-N.J. It would raise AMT exemption
amounts to "hold harmless" people that were not subject to the AMT
in 2008.
Officials in the administration of President Barack Obama have
resisted inclusion of the AMT patch in the stimulus legislation, in
order to hold down costs.
In other additions to the legislation Tuesday, Senate Finance
Committee Chairman Max Baucus, D-Mont., proposed expanding a tax
benefit for businesses that repurchase debt at a discount as the
committee began debate on a roughly $272 billion package of tax
changes aimed at spurring the economy.
The panel is aiming to vote on the package Tuesday, with a vote
by the full Senate possible by week's end.
The debt repurchase provision is more generous than what Baucus
originally proposed, but it still falls short of what the U.S.
Chamber of Commerce and companies including Dish Network Corp.
(DISH), Lennar Corp. (LEN), Qwest Communications International Inc.
(Q), and Tenet Healthcare Corp. (THC) had sought.
Those firms wanted a two-year suspension of taxes on income
recognized because of canceled debt. Such income could arise as
firms repurchase shares to shore up their balance sheets.
Instead, the revised Senate bill would allow them to spread
recognition of that income over eight years. That is up from four
years in the bill as introduced last week.
Sen. John Ensign, R-Nev., said that provision did not go far
enough to help businesses restructure debt, and criticized the bill
for not doing enough to address housing directly. "I believe this
'mark' has missed the mark," said Ensign.
The Senate bill cuts taxes for individuals and businesses by
$272 billion over 10 years. On the individual side, the key
provision is a $500 payroll tax credit proposed by President Barack
Obama during last year's campaign.
The legislation may also undergo more changes as panel members
sift through dozens of amendments during today's session. Sen.
Charles Grassley, R-Iowa, the senior Republican on the panel, and
Sen. Bob Menendez, D-N.J., each plan to offer amendments to shield
most middle-income taxpayers from the effects of the alternative
minimum tax in 2009. That would add around $70 billion to the
bill's overall cost.
"We think that the provisions in this bill represent the best
ways to address spending slowdowns and rising unemployment," Baucus
said at the outset of the committee session.
In another last-minute revision, Baucus proposed extending the
period for first-time home buyers to qualify for a tax break. Under
last year's housing legislation, first-time home buyers that
purchase homes before July 1, 2009 can qualify for a $7500 tax
credit, which they must repay to the federal government over 15
years.
The latest version of Baucus' bill would extend eligibility for
the credit to homes purchased before Sept. 1, 2009, and would waive
the repayment requirement for homes purchased between Jan. 1 and
Sept. 1, 2009.
The Senate bill would cut taxes for businesses by a total of $25
billion over 10 years. It would also spend $31 billion over 10
years for investment in renewable energy.
In addition to the tax provisions, the Senate bill includes some
$86 billion in aid to states by increasing federal Medicaid
payments.
The bill would spend $27 billion to help workers who are laid
off retain COBRA health-insurance coverage. It includes $39 billion
to extend and augment unemployment benefits and $4 billion for
welfare and child support programs.
-By Martin Vaughan, Dow Jones Newswires; 202-862-9244;
martin.vaughan@dowjones.com
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