By Steven Cooper, Washington Staff Writer
The House of Representatives overwhelmingly approved comprehensive tax, healthcare and trade legislation on December 8, 2006, meeting an election year promise to extend a group of expiring tax provisions before the 109th Congress adjourns.
The House voted 367-45 to pass the wide-ranging measure, then combined it with other international trade bills and sent it to Senate lawmakers.
"This legislation extends a number of tax and energy provisions critical to American economic growth and opportunity, while providing critical updates to Medicare, avoiding an impending physician payment cut and rooting out waste, fraud and abuse," said Ways and Means Chairman William M. Thomas (R-Calif.).
Rep. Charles B. Rangel (D-N.Y.), who assumes chairmanship of the tax panel in January, said he supported the imperfect bill, which could have been passed earlier in this year and signed into law already. "I support this overdue legislation because we need to give taxpayers and businesses certainty as they make financial plans for the coming years," Rangel said.
The legislation includes $35.9 billion in provisions to extend and modify tax relief, $3.4 billion in energy tax provisions, $1 billion in expanded health savings account provisions, and roughly $4.8 billion in miscellaneous tax and other provisions, according to very preliminary estimates from the Joint Committee on Taxation.
Included are provisions that would extend through 2006 the research and development tax credit, the state and local sales tax deduction, the tuition expenses deduction, the new markets tax credit, the earned income tax credit for combat pay, and teacher classroom expenses deduction.
In addition, for 2007, the contribution limits for health savings accounts (HSAs) will be expanded. Workers using HSAs will be able to contribute up to the maximum of $2,850 for singles ($5,650 for families), instead of being limited by the size of the plan's deductible. Moreover, increased flexiblity will be added to the contribution rules, such as allowing for mid-year enrollment with full-year contributions, or permiting special circumstances for one-time distributions from retirement plans or flexible spending accounts into HSAs.
After Senate passage of the bill, President George W. Bush is expected to sign it into law before the end of the 2006 tax year.
- Related items:
- Failure to Renew Expired Tax Extenders Subject of Concern, Debate
- Congressional Panel Examines Business Tax Reform
- Rules Change for Hybrid Vehicle Tax Credit
- Congress Passes Comprehensive Pension Reform Bill
- Estate Tax/Minimum Wage Bill Falls in Senate; Pension Legislation Approved
- House Couples Estate Tax Reform with Minimum Wage Hike
- House Passes Estate Tax Relief Bill, Senate Vote Expected Next
- Full Estate Tax Repeal Dies in Senate; Compromise Reform Under Consideration
- Congress Extends Tax Relief Provisions with Offsets, Seeks To Reinstate Expired Credits
Added to the news on December 20, 2006.
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