Ways and Means passes permanent extension of seven “tax extenders”

Permanent extension of seven “tax extenders”

The House Ways and Means Committee today held the committee’s first mark-up of 2015 by addressing seven bills, most of which would permanently extend a number of provisions that have historically been addressed on a temporary basis as part of the recurring “tax extenders” process. The reported bills do not include revenue offsets.

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Seven bills

The following bills were passed by the committee and reported to the House of Representatives on party-line votes:

  • Make permanent the increase in allowable section 179 expensing levels to an annual maximum of $500,000 for qualifying small businesses (H.R. 636)
  • Make permanent the reduction of the recognition period for built-in gains tax in section 1374(d) to five years (H.R. 629)
  • Make permanent the rules regarding basis adjustments to stock of S corporations making charitable contributions of property (H.R. 630)
  • Make permanent the section 170(b) rules for qualified conservation contributions by individuals and certain corporations and provide special rules for qualified conservation contributions conveyed under the Alaska Native Claims Settlement Act (H.R. 641)
  • Make permanent the special rules in section 170(e)(3)(C) for contributions of food inventory, modify the limitation on the aggregate amount of such contributions taken into account, and add rules for determining food basis and value in certain cases (H.R. 644)
  • Make permanent the rule in section 408(d)(8) allowing certain tax-free distributions from individual retirement accounts (IRAs) for charitable purposes (H.R. 637)
  • Lower the current 2% rate of excise tax on net investment income of private foundations to one percent (H.R. 640)

The various bills are currently scheduled to be debated on the floor of the House of Representatives by the end of the month.

Text of the bills and amendments, as well as descriptions of each bill provided by the Joint Committee on Taxation are available on the Ways and Means website.

Background

Various attempts to make some of these proposals permanent were made in the last Congress, but ultimately, the temporary proposals were included with the larger “tax extenders package” and their effective dates have continued to be short-term.

The failure to make these items permanent is, in part, attributable to the president’s threat to veto permanent extensions of expiring provisions when the revenue costs are not offset.

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