House passes AMT relief by 216-193 vote

The House passed today a bill that would relieve an estimated 23 million taxpayers from being subject to the alternative minimum tax for a year by a vote of 216-193. However, the bill faces rougher sledding in the Senate, where many object to provisions that would raise tax rates on private equity managers, venture capitalists and some real estate investors to income tax rates as high as 35% instead of capital gains tax rates of 15%. House Democrats touted the bill as necessary to allow middle-income taxpayers to deduct property, state and local taxes, and education expenses, as well as allowing them to take advantage of credits such as the child tax credit. The tax increase is necessary to pay for the $78.3 billion cost of providing the tax relief, Democrats argue. Republicans argue that under the Democrats’ bill, 90% of all taxpayers would still face higher taxes in the future as the 2001 and 2003 Bush tax cuts are allowed to expire.