The Senate Dec. 18 voted 65-33 to clear a combined tax extenders and omnibus spending package, clearing the way for the measure to be signed by the President. The House Dec. 17 voted 318-109 in favor of the tax extenders, including several provisions of importance to medical schools and teaching hospitals.
The tax extenders bill permanently extends the research and development (R&D) tax credit. Additionally, beginning in 2016 eligible small businesses ($50 million or less in gross receipts) may claim the credit against alternative minimum tax (AMT) liability, and the credit can be utilized by certain small businesses against the employer’s payroll tax (i.e., FICA) liability.
The measure also extends through 2016 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).
The bill permanently extends the ability of individuals at least 70.5 years of age to exclude from gross income qualified charitable distributions from Individual Retirement Accounts (IRAs). The exclusion may not exceed $100,000 per taxpayer in any tax year.