About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

Taxes and Fiscal Year 2006 Budget Reconciliation: A Brief Summary, Date: December 8, 2005 1 (December 8, 2005)

handle is hein.tera/crstax0507 and id is 1 raw text is: Order Code RS22322 Updated December 8, 2005 CRS Report for Congress Received through the CRS Web Taxes and Fiscal Year 2006 Budget Reconciliation: A Brief Summary David L. Brumbaugh Specialist in Public Finance Government and Finance Division Summary On April 28, 2005, Congress approved an FY2006 budget resolution (H.Con.Res. 95) with reconciliation instructions calling for three bills: a bill containing spending cuts ($1.5 billion in FY2006 and $34.7 billion over five years); a bill increasing the public debt limit by $781 billion (to $8,965 billion); and a bill containing tax cuts. The reconciliation instructions for taxes called for tax cuts of$11 billion in FY2006 and $70 billion over five years. As 2005 draws to a close, Congress has begun consideration of the tax-reduction reconciliation bill. On November 15, both the House Ways and Means Committee and the Senate Finance Committee approved separate tax-cut proposals as H.R. 4297 and S. 2020, respectively. The full Senate approved a slightly modified version of S. 2020 on November 18. An important part of both bills is the extension of numerous temporary, tax-reducing provisions that are scheduled to expire at various times over the next several years. While most of these extenders are the same in each package, there are some differences, including extension of the increased alternative minimum tax (AMT) exemption, which is contained in the Senate proposal but not the Ways and Means bill; and reduced rates for capital gains and dividends, which are in the Ways and Means measure but not the Senate plan. Aside from the extenders, the Senate bill contains a number of additional items not contained in the Ways and Means Committee plan, including tax incentives for development in areas affected by recent hurricanes; both tax benefits and reforms related to charitable contributions; and revenue-raising items in the area of tax shelters and elsewhere. In addition, on December 7, the House passed stand alone bills extending the increased AMT exemption (H.R. 4096) and providing disaster-related tax benefits (H.R. 4440). This report will be updated as legislative developments occur. The figures in the budget resolution do not place an absolute limit on the tax cuts Congress can pass for FY2006 or subsequent years - for example, the budget resolution itself called for a total of $106 billion in tax cuts over five years - the same amount proposed by President Bush in his FY2006 budget proposal. However, the congressional budget resolution contains only $70 billion in its reconciliation instructions ($11 billion Congressional Research Service • -The Library of Congress

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Short-term subscription options include 24 hours, 48 hours, or 1 week to HeinOnline.

Purchase Access

Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most