The Senate voted 96-3 Tuesday to begin debating a bill to renew more than 50 tax breaks for businesses and individuals. Most of the tax breaks expired at the beginning of the year. The bill would renew them through 2015, adding about $85 billion to the budget deficit.
Some of the key tax breaks, with the amount taxpayers would save over the next decade:
–A tax credit for businesses that invest in research and development. Savings: $15.4 billion.
–A tax credit for using wind farms and other renewable energy sources to produce electricity. Savings: $13.3 billion.
–An exemption that allows banks, insurance companies and other financial firms to shield foreign profits from being taxed by the U.S. Savings: $10.4 billion.
–A deduction that allows residents who live in states without an income tax to deduct state and local sales taxes on their federal returns. Savings: $6.5 billion.
–A tax break that protects struggling homeowners who get their mortgages reduced from paying income taxes on the amount of debt that was forgiven. Savings: $5.4 billion.
–A tax break that allows restaurants and retailers to more quickly write off the cost of capital improvements. Savings: $4.8 billion.
–A tax break called bonus depreciation that allows profitable companies to write off large capital expenditures immediately, rather than over time. Savings: $2.9 billion.
–A tax deduction of up to $250 for teachers who use their own money to buy classroom supplies. Savings: $430 million.
–A tax credit for expenses related to railroad track maintenance. Savings: $414 million.
–Increased tax rebates to Puerto Rico and the Virgin Islands from a tax on rum imported into the United States. The U.S. imposes a $13.50 per proof-gallon tax on imported rum, and sends most of the proceeds to the two U.S. territories.
Previously, the rebate was $10.50 a gallon. The new law extends a more generous rebate of $13.25 a gallon through 2015. Cost: $336 million.
–A tax break that allow motorsport races tracks to more quickly write off the cost of improvements. Savings: $71 million.
–A tax break that allows TV, movie and theatrical productions to more quickly write off expenses. Sexually explicit productions are ineligible. Savings: $27 million.
–A tax break that allows people who buy race horses to more quickly write off the cost. Savings: $9 million.
Source: Joint Committee on Taxation.
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