December 2007 Legislation
From TaxAlmanac
Contents |
House Protects Millions of Families from AMT
The House of Representatives voted in favor of the Senate Amendment to H.R. 3996, the Tax Increase Prevention Act of 2007, legislation providing immediate tax relief to millions of families who would otherwise pay higher taxes under the alternative minimum tax (AMT) this year. Today’s action followed recent efforts by Senate Democrats to raise taxes somewhere else to make up for this AMT action. The House twice passed legislation that did just this earlier this fall, but both measures, H.R. 3996 and H.R. 4351 fell victim to filibuster threats by Senate Republicans, who were concerned that lowering taxes in one place and raising them in another would not accomplish their goals of a net lowering of taxes.
H.R. 3996 would extend for one year AMT relief for nonrefundable personal credits and increase the AMT exemption amount to $66,250 for joint filers and $44,350 for single filers to ensure that no additional taxpayers are liable for the AMT this year.
Mortgage Tax Relief Legislation Signed Into Law
Senate Finance Committee Chairman Max Baucus (D-Mont.) hailed the signature of the Mortgage Forgiveness Debt Relief Act of 2007 into law. This legislation offers tax relief to American families caught in the sub-prime mortgage crisis. When debt is forgiven on a home loan, the homeowner must normally count that debt forgiveness as income and pay taxes on it. The mortgage tax relief bill creates a three year exception for debt forgiveness on home loans – helping families already unable to meet their mortgages to avoid incurring large tax bills as well. It also extends a provision allowing homeowners to deduct mortgage insurance payments from their taxable income. The Senate approved a Baucus amendment to the House-passed bill, H.R. 3648, on December 18.
“This bill reaches out a helping hand to the millions of American families struggling to pay their bills in the wake of the sub-prime mortgage crisis,” said Baucus. “This timely tax relief will help families save money, and get their financial feet back under them. Congress needs to do more to examine the causes of the sub-prime mortgage crisis and to protect Americans seeking the dream of home ownership.”
In addition to tax relief for debt forgiveness and mortgage insurance payments, the bill includes:
- Tax relief for volunteer firefighters and emergency medical technicians
- Help to expand housing options for college students with children
- Protection of tax relief for homeowners after the death of a spouse
- Flexibility to help co-op tenant/owners deduct real estate taxes and mortgage nsurance
The bill is fully offset by increased penalties for failure to file S corporation returns or partnership returns, and new requirements for the payment of corporate estimated taxes.
Clean Renewable Energy and Conservation Tax Act of 2007
Tax Technical Corrections Act of 2007
- All material compiled from Joint Committee on Taxation
