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Washington Highlights

Houses Approves Tax Extender Deal; Senate Vote Expected Next Week

December 5, 2014—The House of Representatives Dec. 3 voted (378-46) to approve a package of tax breaks for individuals and businesses. The Tax Increase Prevention Act of 2014 (H.R. 5771) extends for one year several tax provisions of interest to medical students, medical schools, and teaching hospitals.

The bill would extend through 2014 the above-the-line deduction for qualified tuition and related expenses for higher education. The deduction is capped at $4,000 for an individual whose adjusted gross income (AGI) does not exceed $65,000 ($130,000 for joint filers) or $2,000 for an individual whose AGI does not exceed $80,000 ($160,000 for joint filers).

Of importance to research institutions, the bill would extend the research and development (R&D) tax credit. The R&D credit generally allows taxpayers a 20 percent credit for qualified research expenses or a 14 percent alternative simplified credit.

The legislation also would extend the availability of tax-free distributions from individual retirement plans for charitable purposes. The exclusion may not exceed $100,000 per taxpayer in any tax year.

The measure is a scaled back compromise from earlier proposals, which would have made the R&D tax credit and the American Opportunity Tax Credit (AOTC) permanent. That proposal failed to garner support from the White House because it did not include permanent extensions of enhancements to the Earned Income Tax Credit and the child tax credit designed to help more low-income individuals.

Senate Finance Committee Chair Ron Wyden (D-Ore.) said he does not expect his colleagues to make any changes to a House-passed tax extender bill.


Matthew Shick, JD
Director, Gov't Relations & Regulatory Affairs
Telephone: 202-862-6116


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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806