Rep. Johnson Praises Tax Relief Act

Rep. Johnson Praises Tax Relief Act

Washington, D.C. - {Rep. Timothy V. Johnson said today that the passage of the Tax Relief Extension Reconciliation Act of 2005 holds promise for all Americans and is the key to sustaining what has been an impressive record of economic growth.

The measure passed the House on a vote of 234-197 Thursday afternoon and must now be reconciled with Senate versions. It is hoped that the final measure will be forwarded to the White House by the end of the year.

"The economic policies of this administration and Congress continue to drive the forward progress of our national economy, overcoming natural disasters and the cost of the War on Terror among many other challenges," Rep. Johnson said. "Tax relief policies have allowed continued reinvestment, putting more people to work, putting more money in their pockets and generating federal revenue to pay for vital needs. This legislation will continue that growth in ways that will benefit all Americans and all sectors of our economy."

Among the highlights of the bill are the following:

· Extension of the research tax credit. Up to 20 percent of qualified research expenses in excess of a base amount may be claimed as a credit, an important incentive to private enterprise to invest in new and ongoing research.

· The exclusion of many personal tax credits - including the dependent care credit, credit for elderly and disabled, credit for interest on home mortgages, Hope Lifetime credit and Lifetime Learning credit - from counting toward the Alternative Minimum Tax. Rep. Johnson was part of the overwhelming majority of the House that on Wednesday blocked an increase in the AMT. That action prevents a tax increase from affecting some 15 million families.

· Deductions of up to $4,000 for higher education expenses in lieu of claiming the Hope Scholarship or Lifetime Learning tax credits.

· Welfare-to-Work tax credits for employers who hire individuals on public assistance.

· Work Opportunity tax credits for hiring individuals who have faced barriers to employment.

· Deductions for teachers' purchase of school supplies.

· Enhanced charitable deductions for computer donations to schools and libraries.

· Extension of reduced tax rates on capital gains and dividends.

· Extension of individuals' ability to make tax-deductible contributions to medical savings accounts for health-care expenses.

"Those are a sampling of a range of improvements in this legislation, many of which were initiated in 2003 and which we are just extending at this point," Rep. Johnson said. "Since that time, our economy has grown at an annual rate of over 4 percent. More than four million jobs have been created and government tax receipts have increased 10 percent annually.

"Whether it's job growth, home sales or consumer confidence, virtually all economic indices are testament to the effectiveness of these policies," Rep. Johnson said. "Generally, these policies reflect a less intrusive government that allows the enterprise and productivity of our citizens to be rewarded. The House's action today should be applauded."

http://www.house.gov/apps/list/speech/il15_johnson/_taxreliefpressrelease1.html