Senate passes weaker tax bill.

The United States Senate passed its version of the president's deficit reduction bill last week that does not go as far in offering relief to the industry as the House version.

The version was passed 50 to 49 despite the lack of Republican votes. With six Democrats dissenting, Vice President AI Gore had to passed the deciding vote.

While passive loss reform measure in the House version enables qualified real estate professionals to use losses from rental property to offset income from all business activity, the Senate version will only enable the rental losses to be used to offset income from that activity.

"Unless we get that part of it, we're i not being treated like other business people," said Cary Brazeman, spokesperson for the National Realty Committee.

The Senate version also deletes a debt restructuring provision from the House version. Instead of forcing owners who have debt forgiven by banks to pay tax on the amount in the current year, this measure would allow owners to extend the payment over time via lower depreciation deductions and a greater gain on sale.

Broader investment criteria for pension funds, another House provision, is also absent from the Senate bill.