Despite concerns over the rising deficit, both houses of Congress sent a $6.1 billion Katrina tax-relief bill to President Bush for his signature without a dissenting vote being cast.
The House gave its approval on a 422-0 vote, and the Senate moved the legislation through without a roll call.
Individuals and affected businesses will see a waiver of rules limiting personal-casualty deductions, and taxes on early IRA withdrawals and cancelled debts, as well as time extensions for spending insurance settlements without paying taxes.
More employers will be eligible for Work Opportunity Tax Credits and will be eligible for employee retention tax credits. In 2005, tax limits on individuals' and corporate cash donations will be waived and deductions for donating books to public schools can be taken.
Congress's current calendar means a deficit-reduction measure promised last spring -- likely in the neighborhood of $35 billion over five years -- will come to the floor in late October. Around the same time, a third supplemental spending request from President Bush for Katrina is expected.The $6.1 billion estimate represents the five-year impact of the bill, but about $5.9 billion will be spent over the next two years. Other measures on the table for another round of relief proposals are offering tax-exempt bonds as private financing through both federal and state governments.
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