Congress passes fiscal cliff agreement to extend tax rates for incomes below $450,000; deal includes business "tax extenders"

Washington National Tax Services

The House and Senate have approved a "fiscal cliff" agreement (H.R. 8 as amended) reached with the Obama Administration that would extend permanently certain 2001 and 2003 tax provisions for individuals with incomes below $400,000, and joint filers with incomes below $450,000. President Obama is expected to sign the legislation. The bill also provides permanent indexing of individual alternative minimum tax (AMT) exemption levels for 2012 and subsequent years. In addition, the approved bill extends certain expired and expiring business and individual tax provisions through the end of 2013. Renewed business tax provisions include the research credit (with modifications), CFC look-through, the exception for active financing income, and various renewable energy tax credits. In addition, the agreement extends a current 50-percent "bonus" depreciation provision for qualified property through the end of 2013.

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