RESEARCH CREDIT, LOW INCOME HOUSING AND HEALTH INSURANCE PENDING TODAY'S CONGRESSIONAL VOTE
RESEARCH CREDIT, LOW INCOME HOUSING AND HEALTH
INSURANCE PENDING TODAY'S CONGRESSIONAL VOTE
WHAT: There has been a coordinated effort by Congressional leaders to rush a tax bill through Congress today to extend popular tax incentives for businesses and individuals. The tax bill, which extends 12 expiring tax breaks for a six-month period, is expected to reach the House and Senate floors today -- just before lawmakers leave for the year.
Important elements of the bill are credits for business research and experimentation and for low-income housing development, and a 25 percent deduction for the health insurance costs of the self-employed. Besides these provisions, the bill extends: an exclusion accorded for employer- provided educational assistance, an exclusion for employer-provided group legal services; preferences for certain mortgage bonds and certain mortgage certificates; a preference for certain manufacturing bonds; a targeted jobs tax credit; a business energy tax credit; and a credit for clinical testing of orphan drugs.
To pay for the cost, the Senate Finance Committee has approved a measure aimed at large corporations. The estimated tax provision would raise, for corporations reporting annual income in excess of $1 million, the amount of money companies must pay quarterly to avoid an underpayment penalty. At present, the penalty can be avoided if total estimated payments equal 90 percent of actual liability. Under the measure, that would gradually increase to 95 percent by 1995.
WHO: Gillian Spooner, a partner in KPMG Peat Marwick's Washington National Tax Practice, is available to discuss the probability of the measure being passed, implications for business, among other issues. Spooner has served as a staff member of the Joint Committee on Taxation, for which she formulated and analyzed tax policy alternatives. She drafted official reports of the House, Senate and Conference committees; and briefed staff and member of Congress on tax proposals.
CONTACT: Lisa Meyer of KPMG Peat Marwick, 201-307-7763.
CO: KPMG Peat Marwick ST: New Jersey, District of Columbia IN: FIN SU: LEG FC-OS -- NY063 -- 7408 11/26/91 14:59 EST