House, Senate Plan Final Action on Tax, Spending Bills
The following article is provided courtesy of CCH, Inc.
The House plans to consider a few tax measures before its target adjournment on Dec. 15. The Senate is expected to quickly follow suit and wrap up the 106th Congress.
Although a far cry from the Certified Development Company Program Improvements Bill of 2000 (HR 2614), the $240 billion, tax-cut package the GOP had hoped to push through, lawmakers view the current tax measures as popular enough to pass and allow Congress to finish its legislative business for the year. The two bills under consideration include reinstatement of the installment method of accounting for accrual method taxpayers and tax breaks to help revitalize poor communities.
The Installment Tax Correction Bill of 2000 (HR 3594) would repeal amendments to the Internal Revenue Code made by the Ticket to Work and Work Incentives Improvement Act of 1999 (PubLNo 106-170), which repealed the use of the installment method of accounting for accrual method taxpayers and modified the pledge rules of installment obligations. HR 3594 was introduced by House Ways and Means Committee member Wally Herger, D-Cal, and is estimated to cost $2 billion over 10 years.
In addition, Congress is expected to pass the conference report to the Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Bill, 2001 (HR 4577), which is expected to contain a $25 billion, 10-year measure to encourage renewal of economically distressed communities. The bill also is expected to contain a two-year extension of tax- favored medical savings accounts, according to Senate Majority Leader Trent Lott, R-Miss.
The community renewal provisions of the budget deal are expected to provide for 40 urban and rural renewal communities within which taxpayers would be eligible for a capital gains tax exclusion on the sale of businesses or business assets and other tax incentives. In addition, the proposal would designate nine new empowerment zones and provide a $1,500 tax credit on the first $10,000 in business earnings. The bill is based on the Community Renewal and New Markets Bill of 2000 (HR 4923), which passed the House on July 25 (TAXDAY, 2000/07/26, C.2) and was included in HR 2614. However, both HR 4923 and HR 2614 became bogged down in the Senate and never reached the Senate floor.