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Congress poised to pass one-year extension of expired tax provisions

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The House of Representatives voted 378–46 on Dec. 3 to approve a one-year agreement that would retroactively restore nearly all of the 50-plus tax provisions that expired at the end of 2013. The legislation would give taxpayers immediate relief for 2014 but would quickly leave taxpayers in limbo again for 2015.

The Tax Increase Prevention Act of 2014 (H.R. 5771) includes one-year retroactive extensions of many significant expired provisions, including:
  • The research credit
  • Bonus depreciation
  • The deduction for state and local sales taxes
  • The reduced five-year holding period for S corporation built-in gains
  • Tax-free individual retirement account distributions for taxpayers age 70½ and older
  • Subpart F exception for active financing
  • Subpart F look-through rule for controlled foreign corporation income
  • 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and qualified retail improvements

Only a handful of expired provisions would not be extended in the deal.