Washington D.C.—Idaho Senator Mike Crapo co-sponsored a bill introduced today providing relief from a tax unintentionally aimed at millions of middle-income Americans, including nearly 100,000 Idahoans. The Alternative Minimum Tax and Extenders Tax Relief Act of 2008 provides a one-year “patch” of the Alternative Minimum Tax (AMT) and extends important energy tax relief and incentives for teachers, veterans, small businesses and others, that have expired or are set to expire. Crapo favors a full repeal of the AMT but is also supportive of this effort to enact this 2008 AMT patch now, rather than waiting until the end of the year.
“Unfortunately, Congressional leadership waited until the last minute last year to pass legislation to prevent the AMT from hitting the middle class,” noted Crapo, member of the Senate Finance Committee. “Now, just a couple months later, we are again in the position of needing to do something to prevent those same taxpayers from being hit by the AMT in the 2008 tax year.”
The bill also contains extensions of key tax provisions that expired at the end of the 2007 tax year. These provisions include the research and development tax credit, the tax deduction for teachers who purchase classroom supplies out of their own pockets, the qualified tuition deduction for students, accelerated depreciation for business property on Indian Reservations, and provisions providing for mortgage bonds for veterans and penalty-free IRA withdrawals for Reservists. Under this legislation, all of these provisions, and others, would be extended for two years.
“It is also important to note that this legislation does not contain billions of dollars of tax increases, as some are calling for, to offset the extensions of these tax provisions,” said Crapo. “It is not good policy to put ourselves in a position to enact permanent tax increases to offset the temporary extension of current tax law.”
The bill is sponsored by Senate Finance Chairman Max Baucus (D-Montana) and Ranking Member Charles Grassley (R-Iowa), along with a bipartisan group of Finance Committee members. A date for consideration by the Finance Committee has not yet been determined.