Small Business & Extender Tax Bill Update

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Small Business & Extender Tax Bill Update

If you watched the Senate floor yesterday, you might be under the impression that nothing was happening. The Senate spent most of the day in a Quorum Call (Senate code for nothing happening), and when a member did take the floor, often it was to speak about something other than small business taxes.

Ah, but still waters run deep, don’t they. Behind the scenes, two efforts were taking place. First, Leaders Reid and McConnell were continuing their back-and-forth over whether Reid would allow any amendments to the underlying small business tax bill and, if he did, what those amendments would be. McConnell’s office sent around the list of eight amendments he was asking for, including amendments to:

  1. Repeal the new 1099 requirements starting in 2012;
  2. Extend for one year the R&D tax credit;
  3. Extend the expired biodiesel fuel tax credit; and
  4. Fix the current estate tax mess.

Later yesterday evening, Senator Reid offered a shorter list of both Republican and Democratic amendments — each side would get three so-called side-by-side amendments.B McConnell objected to that request. Reid then objected to McConnell’s longer list, and we’re back at square one.

Meanwhile, Finance Chairman Max Baucus has spent the last couple weeks working with key members to revise his tax extenders package. His staff sent around a list of proposed changes yesterday evening, and he is expected to release Baucus IV sometime later today.

Good News Alert: We believe the S corporation payroll tax provision has been dropped!

So what’s going to happen? The Senate is scheduled to vote on ending debate on the small business tax package (Reid amendment #4519) — without Baucus IV or other amendments — this morning. As BNA is reporting:

Absent an agreement, Senate Majority Leader Harry Reid (D-Nev.) said the chamber would vote early July 29 on one cloture motion on a substitute amendment (S. Amdt. 4519) and one on the underlying bill. “We reached an impasse here,” Reid said late July 28 after he and Minority Leader Mitch McConnell (R-Ky.) traded potential agreements on the floor and then disagreed to both.

The motion to end debate would need 60 votes to prevail, and Democrats are telling folks they don’t expect to succeed. We’re not so sure, but we’ll find out shortly. If the vote does fall short, the whole issue will likely get kicked into September.

2019-02-04T15:47:04+00:00