On Tuesday night the Senate passed a bill that would retroactively renew tax extenders that expired at the end of 2013. The Tax Increase Prevention Act, passed last week by the House, renews most of the expired tax breaks for another year. The bill, passed 76-16, now goes to President Obama, who is expected to sign the bill next week.
Included in the bill is a retroactive renewal of the Research and Development Tax Credit for 2014. Taxpayers will therefore be eligible to take advantage of the credit for 2014. Other tax breaks provided by the bill include the wind production tax credit, renewable fuel credits and deductions for mortgage debt forgiveness. The renewal of these tax breaks is expected to cost $41.6 billion over the next 10 years. While the renewal applies only to 2014, Congress is expected to take up the issue again in early 2015. According to Senate Finance Committee ranking minority member Senator Orrin Hatch (R-UT), among the issues to be considered is the permanent extension of the Research and Development Tax Credit.