Expiring Federal Tax Provisions

Frustrated Senate leaders are unable to pass legislation to renew and extend expired federal tax provisions.

Several months of moving and jockeying the so-called “Extenders” or “Expiring Provisions” in and out of several legislative vehicles have still not led to final passage in the Senate.  Included in the stalled bill are 1 year reauthorizations of the Federal Empowerment Zone and Renewal Community Credits (and by default, their WOTC category counterparts), Katrina WOTC, the Washington DC Zone Credit and the Indian Employment credit as well as the Research and Development Credit.  The credits all expired at the end of 2009 (except for Katrina WOTC which sunset in late August 2009) and all are poised to be renewed retroactively.

While all of these credits enjoy wide-spread and bipartisan support, the Senate has been unable to include them in broader legislation able to muster the 60 voters needed to invoke cloture and call for a vote.

Numerous efforts to tweak the bill to pick up enough Republican support have failed:  each suggested compromise or concession relating to other components in the measure that would have added one or two GOP votes have resulted in an equal number of Democrats saying that they would change their vote to “no.”

Passage has become even more complex since the revenue provisions that were previously designated to offset the cost of the Extenders was pulled from that bill and added to a package to fund state education and Medicaid programs that passed the Senate on August 4th.

Senate Finance Committee Chairman Max Baucus (D-MT) once again reiterated his commitment to the Extenders, but reminded supporters that “We are going to have to make sure its [the Extenders] fully offset.”  While Congress is in its annual August recess staff members are working to find a formula that will offset these items and obtain the 60 voters necessary to invoke ‘cloture’ limiting further debate and calling for a final vote on the bill.  Time is running short as Congress will only be in session for less than a month after Labor Day before recessing in early October for Election campaigning.  If the Extenders are not passed by then the last opportunity for this Congress to enact them will be the ‘lame duck’ session following the election.  For more information on the status of the Extenders, contact Roy Goldman by phone (732) 657-5041 or email: Roy.goldman@ntlci.com