U.S. House Passes Tax-Cut Extension Bill

Posted By on December 16, 2010

The U.S. Congress passed an $858 billion bill extending for two years all Bush-era tax cuts, and now the measure goes to President Barack Obama for his signature.

Majorities of both parties supported the bill. Voting in favor were 139 Democrats and 138 Republicans, while 112 Democrats and 36 Republicans voted against it. Eight lawmakers didn’t vote.

The tax-cut plan extends through 2012 all Bush-era tax reductions on income, capital gains and dividends. It continues expanded unemployment insurance benefits through 2011, cuts payroll taxes by 2 percentage points during 2011 and lets businesses write off 100 percent of capital investments between Sept. 9, 2010, and Dec. 31, 2011. Obama agreed on the plan with Republicans on Dec. 6.  The legislation also extends dozens of expired and expiring tax breaks, including a research and development tax credit and a college tuition tax credit that was created in last year’s economic stimulus law.

Under the plan negotiated with Obama, the estate tax next year would have a top rate of 35 percent to be applied after an exemption of $5 million per person.

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