Congress moves to extend tax breaks 12 provisions would expire at year's end

November 26, 1991|By William J. Eaton | William J. Eaton,Los Angeles Times

WASHINGTON -- Operating with rare speed and precision, Senate and House tax-writing committees unanimously endorsed yesterday a six-month extension of a dozen popular tax breaks scheduled to expire Dec. 31. Congress is expected to give its final approval this week.

President Bush has indicated he would sign the legislation if no additional provisions were added before the measure reached his desk.

As a result, tax credits for low-income rental housing, for business research and for health insurance expenses for self-employed people are likely to be extended once again, at least for the first half of 1992.

Other provisions would continue the deductibles for company-paid education and legal expenses, exempt mortgage revenue bonds from federal taxation and extend tax credits for solar and geothermal energy projects.

A program to give tax credits to companies for hiring the disadvantaged also would be continued under the bill.

The cost of the credits, estimated at $3.1 billion over the next five years, would be offset by an increase in quarterly income tax payments by corporations with annual taxable income of more than $1 million.

Instead of paying 90 percent of their current tax liability, such large corporations would be required to base estimated tax payments on 93 percent of their current liability in 1992; the percentage would rise to 94 percent in 1993-1994 and 95 percent thereafter.

Consideration of the measure was choreographed to prevent the addition of costly or controversial tax amendments, particularly the Republican-backed proposal to lower capital gains taxes.

The House is expected to take up the bill today with the Senate acting shortly thereafter.

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