Top lawmakers in Congress on Tuesday unveiled a bipartisan tax deal that would expand the child tax credit and give businesses a series of breaks, and will now race against a self-imposed deadline to clear the package.
The $78 billion package announced by Senate Finance Committee Chairman Ron Wyden and House Ways and Means Committee Chairman Jason Smith would expand access to the child tax credit and eliminate a penalty for larger families, in a move hailed by Wyden, an Oregon Democrat.
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“Fifteen million kids from low-income families will be better off as a result of this plan, and given today’s miserable political climate, it’s a big deal to have this opportunity to pass pro-family policy that helps so many kids get ahead,” he said in a statement.
Smith, a Missouri Republican, said: “American families will benefit from this bipartisan agreement that provides greater tax relief, strengthens Main Street businesses, boosts our competitiveness with China, and creates jobs.”
Among the deal’s provisions businesses will be allowed to immediately deduct the cost of their U.S.-based research and development investments, instead of over five years. It also restores 100% expensing for investments in machines, equipment and vehicles.
Wyden has made Jan. 29, the beginning of tax filing season, a goal for passing the deal, though that timeline is uncertain. Congress this week must act to avert a partial government shutdown that would begin after midnight on Friday.
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The deal also contains a provision to increase the supply of low-income housing, through enhancing the low-income housing tax credit.