Washington, DC – Today, Ways and Means Committee Chairman Dave Camp (R-MI) issued the following statement after a bipartisan, bicameral agreement was reached between the House and Senate to make permanent and to reform key tax policies.
Chairman Dave Camp: “This agreement combines the work done on a bipartisan basis in the House and the Senate to prevent tax increases, make permanent critical tax policies, and secure needed reforms. By finally making many important tax policies permanent, hardworking American families will now be able to make critical decisions about how to invest, save, plan for college costs, and make charitable donations. This certainty will also be a great boost to America’s small businesses and entrepreneurs – leading to greater economic growth and job creation.”
The agreement builds off the Senate’s EXPIRE Act, S. 2260, preventing taxpayers from facing unnecessary tax increases when filling out their 2014 returns starting early next year.
Rather than merely “kicking the can down the road” with yet another temporary extension of all these expired tax provisions as originally proposed by the Senate, however, the agreement adopts the approach taken by the House by finally making many of the most critical tax extenders permanent. The ten provisions made permanent under the negotiated agreement are as follows:
- Research and Development credit;
- Section 179 expensing for small businesses;
- Deduction for State and local sales tax;
- Rule for contributions of real property for conservation purposes;
- Charitable deduction for contributions of food inventory;
- Tax-free distributions from IRAs to charities;
- S Corp charitable contributions of property;
- S Corp reduction of recognition period for built-in gains;
- Mass transit benefit parity; and
American Opportunity Tax Credit (AOTC) for education expenses.
The agreement also makes significant reforms to several tax extenders:
- With respect to bonus depreciation, expands AMT relief and expands coverage to include retail improvements and certain agriculture products;
- Eliminates the production tax credit for wind through a phase-down that zeroes out the credit completely in less than three years; and
- Reforms the newly permanent AOTC to crack down on fraud and abuse.
The agreement also includes important, bipartisan tax policy:
- Establishes tax parity for liquefied natural gas and propane fuels;
- Repeals limitations originally established in the Foreign Investment Real Property Tax Act (FIRPTA) that limit investment in the United States;
- Exempts health insurance plans offered to U.S. citizens overseas from onerous ObamaCare mandates; and
- Establishes a new savings vehicle for families with children with disabilities through the ABLE Act.