Senate Finally Passes Retroactive Tax ExtendersDecember 17, 2014
On Tuesday, Dec. 16, the Senate passed 76-17 a bill (H.R. 5771) to retroactively extend through 2014 $41.6 billion in tax breaks that expired at the end of last year. Unfortunately since the extenders bill would only extend those provisions through 2014, it essentially gives business owners only a handful of days to make major spending decisions.
Among those temporary tax deductions, credits, and incentives extended are several critical small-business provisions including the research and experimentation (R&E) credit, bonus depreciation, and increased section 179 expensing. The vote on this must-pass legislation was delayed by several days in an effort by Senate Majority Leader Harry Reid to keep members in Washington, D.C. in order to try to push through a number of nominations.
Support for H.R. 5771 was bipartisan, with 45 Democrats and 31 Republicans voting in favor of the measure. One notable “no” vote was cast by Finance Committee Chairman Ron Wyden (D-Ore.), who in floor remarks shortly before the voting began commented that the tax relief in the package would be short-lived since the extenders provisions would be renewed only through the end of this year. Wyden moved a two-year extenders bill through the Finance Committee in April and had tried in recent weeks to negotiate with House leaders for a longer-term extension of the expired provisions.
The extenders provisions are not offset and, according to estimates from the Joint Committee on Taxation (JCT), would decrease federal revenues by roughly $42 billion over 10 years.
The Senate has now joined the House in adjourning the current Congress. A new 114th Congress, with a Republican-led House and Senate, will convene on January 6, 2015.