The House approved the Tax Extenders Act of 2009, with extensions of a number of tax breaks that are scheduled to expire at the end of the year, including the R&D credit.
The bill was approved by a vote of 241-181. The tax relief provided in todays bill is essential to stimulating job creation and supporting the needs of struggling American families and businesses, said House Ways and Means Committee Chairman Charles B. Rangel, D-N.Y.
The bill includes approximately $31 billion in tax relief in 2009 by extending for one year, through 2010, more than 40 provisions. The bill provides for more than $5 billion in individual tax relief and more than $17 billion in business tax relief. It also extends more than $7 billion of tax provisions that encourage charitable contributions, provide community development incentives, provide tax relief in the event of a presidentially declared disaster, and support the deployment of alternative vehicles and alternative fuels.
Among the individual tax provisions are extensions of the deduction of state and local sales taxes, the additional standard deduction for real property taxes, the above-the-line deduction for qualified tuition and tuition-related expenses, and the above-the-line deduction for certain expenses of elementary and secondary school teachers.
Business provisions include extensions of the R&D credit; the active financing exception in Subpart F of the Tax Code; look-through treatment of payments between related controlled foreign corporations; 15-year straight-line cost recovery for qualified leasehold improvements, restaurant buildings and improvements, and retail improvements; the seven-year straight-line cost recovery period for motorsports entertainment complexes; special expensing rules for U.S. film and television productions; and the employer wage credit for activated military reservists.
Also extended are special rules for regulated investment companies that provide for the tax treatment of interest-related dividends, short-term capital gain dividends, and other special rules applicable to foreign shareholders that invest in regulated investment companies.
Charitable provisions include the extension of a provision encouraging contributions of capital gain real property for conservation purposes, and the extension of the enhanced charitable deduction for contributions of food inventory and of computer equipment for educational purposes. Also extended are deductions for tax-free distributions from individual retirement plans for charitable purposes, and the extension of a special rule for S corporations making charitable contributions of property.
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