WASHINGTON (July 23, 2015) — By a vote of 23-3 on July 21, the Senate Finance Committee passed a bill providing a two-year extension of popular but expired tax breaks.
Among the provisions extended in the legislation is the Work Opportunity Tax Credit (WOTC), which allows employers a 40-percent tax credit on the first $6,000 of wages paid to individuals classified by the federal government as underprivileged.
These classifications include veterans, the disabled and persons who come from areas of the U.S. designated as underprivileged. The new bill would extend the WOTC to include workers who have exhausted regular and state unemployment benefits.
The Tire Industry Association (TIA) has long supported the WOTC and urged its reinstatement. In the most recent issue of TIA's Weekly Legislative Update, the association called for a three-year extension of the credit.
Among the other tax provisions that would be modified and extended under the bill are:
• A small business tax credit of up to $250,000 for research;
• A modification of the employer wage credit for employees who are active-duty members of the armed services, extending it to all employers and increasing the credit rate to 100 percent of eligible wage payments up to $20,000; and
• Indexing for inflation the $500,000 equipment expensing limit and $2 million phaseout limit under Section 179 of the Tax Code for taxable years after 2014.
The bill now goes to the full Senate.