The Senate Finance Committee likely won’t consider tax extenders legislation this year, as Chair Chuck Grassley, R-Iowa, is instead working on a bipartisan, bicameral tax package to attach to a year-end spending bill.
Grassley told Tax Notes October 17 that he had planned on holding a tax extenders hearing, but after committee members couldn’t agree last month on the specifics of a bill, his strategy changed. “We’re down to the point where we don’t have a lot of time,” he said.
Grassley explained that his staff is engaged in a “four-corners negotiation” on the extenders with aides to Finance Committee ranking minority member Ron Wyden, D-Ore., House Ways and Means Committee Chair Richard E. Neal, D-Mass., and Ways and Means ranking minority member Kevin Brady, R-Texas. If agreement can be reached on the makeup of a year-end tax package, there won’t be a need for committee action, Grassley said.
Grassley’s remarks came shortly after the Finance Committee released a report on disaster tax relief, which was the last of six bipartisan task force reports on temporary tax policy. The first three were released in mid-August and covered energy, cost recovery, and individual tax policies. The fourth, on employment and community development, arrived at the end of August. And the fifth, on health policy, was released last month.
In addition to renewing several dozen tax extenders that expired from 2017 to 2019, House and Senate lawmakers have also wanted to fix provisions in the Tax Cuts and Jobs Act, including the depreciation of qualified improvement property and the effective date of net operating loss deduction changes. The most likely vehicle for extenders and other tax changes is legislation required to extend government funding beyond November 21.
Grassley said he couldn’t specify how much had been accomplished during the negotiations on tax extenders, but he seemed to lay the blame for any delay at the feet of the House. “There’s always things, when you’re dealing with the House. . . . They gotta have something else,” he said.
Neal said it’s possible that the House could approve a tax extenders package by Thanksgiving. “I don’t see why not; it is eminently doable,” Neal told Tax Notes October 16.
The Ways and Means Committee approved a tax extenders package in June along party lines, but the measure hasn’t made its way to the House floor yet. The committee also approved separate legislation to expand the earned income and child tax credits.
Jad Chamseddine contributed to this article.