Grassley urges action on tax extenders

Sen. Chuck Grassley (R-Iowa), the ranking Republican on the tax-writing Senate Finance Committee, urged the House to pass legislation that extends several expired tax breaks. 

"It's lingering in the House of Representatives at this particular time and I hope they get it passed," he recently told reporters. "And I will be urging my friends in the House of Representatives to get it passed."

The legislation contains several popular measures for businesses as well as individuals, like the above-the-line tax cut for college tuition and the reimbursement provision for out-of-pocket expenses paid by school teachers. 

Grassley urged completion of the bill to renew a biodiesel tax break that he says will help create jobs.

The legislation has already passed the Senate, but many of its offsets were a part of health reform and cannot be reused. 

The bill now rests with Ways and Means Chairman Sandy Levin (D-Mich.), who is looking at new ways to pay for the legislation. 

One potential offset is ending "carried interest," which taxes investment-related compensation at lower capital gains rates instead of higher marginal rates. 

Levin recently said that Senate opposition to ending carried interest could prohibit him from using it in the bill. But the congressman is an ardent supporter for ending the loophole. 

A conference between House and Senate tax writers could decide whether or not carried interest will be included in the final draft of the bill.