Late on Tuesday, the U.S. Senate renewed $41.6 billion in temporary tax breaks including breaks for business research, wind power and foreign profits, reported Reuters.
The legislation, which passed the Senate with a 76-16 vote, retroactively renews a 55-item package of tax breaks back to Jan. 1, 2014, most of which expired in 2013.
According to Reuters, the bill is projected to cost U.S. taxpayers $41.6 billion over the next 10 years.
The measure includes provisions for state and local taxes, canceled mortgage debt, college tuition, schoolteacher supplies and health insurance. Tax provisions in the short-term bill will help distressed homeowners, teachers who buy their own supplies and commuters who use public transit, The Hill reported.
The three largest tax breaks, comprising nearly half of the total cost, are a $7.6 billion business research and development credit, a $6.4 billion tax break for renewable energy production plants, and a $5.1 billion exemption allowing financial firms to defer taxes on foreign profits, reported Reuters.
An included depreciation bonus allows businesses to write off and deduct capital investments at an expedited rate, costing an estimated $1.5 billion over 10 years, and there's a credit for wind energy as well.
Because the measure is only good through the end of this year, Congress will have to debate the issue again 2015. Should President Barack Obama sign the legislation, taxpayers will be able to claim the tax breaks for the end of 2014.
"It is quite literally the best we could do," said Sen. Orrin Hatch, R-Utah., the incoming chairman of the Senate Finance Committee, reported The Hill.
Current Senate Finance Committee Chairman Ron Wyden, D-Ore., said in a floor speech prior to the bill's passage: "With this tax bill, the Congress is turning in its tax homework 11 months late...this package of tax incentives will last just two weeks before families and businesses are thrown back into the dark with respect to the taxes they owe. The legislation accomplishes nothing for 2015."
Wyden called on Congress to provide greater certainty for taxpayers next year, adding, "The Congress is about to pass a tax bill that doesn't have a shelf life of a carton of eggs."
"Retroactive tax bills like the one before the Senate tonight may satisfy Congress, but they leave workers, families and businesses wanting," Wyden said. "It's time for Congress to do the hard work of tax reform."
