On November 9, the House passed, 219-193, the Temporary Tax Relief Act (H.R. 3996). The House Ways and Means Committee approved the measure on November 1 (see The Source, 11/2/07). The president has indicated that he intends to veto this measure if it is approved by the Senate.
Sponsored by Rep. Charles Rangel (D-NY), the bill would extend through 2008 several expiring tax provisions and increase the alternative minimum tax (AMT) exemption amount (the amount above which the AMT would apply) from $45,000 to $66,250 for surviving spouses and taxpayers who file joint returns, from $33,750 to $44,350 for single taxpayers, and from $22,500 to $33,125 for spouses who file separate tax returns. The measure also would extend for one year provisions that permit taxpayers to use certain nonrefundable tax credits to offset their liability under the AMT.
The bill also would lower the threshold for the refundable child tax credit from $11,750 to $8,500, allowing an estimated 2.9 million additional families to become eligible for the credit. Currently, families are eligible to receive a $1,000 tax credit per child under the age of 17. After 2010, this credit will be reduced to $500. Families with incomes below $11,750 are not able to obtain any portion of the credit.
