Cantor: House to vote to extend research credit

The House expects to vote to extend a research tax break widely used by corporate America for the long term in the coming weeks, Majority Leader Eric Cantor (R-Va.) announced Friday.

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House Ways and Means Committee Chairman Dave Camp has pushed in recent weeks to either extend expired tax breaks like the research and development credit for good, or leave them out of the tax code.

As part of that effort, the Ways and Means Committee will consider measures that would permanently extend the research credit and five other expired tax breaks on Tuesday. A group of more than 50 tax breaks in all, commonly known as extenders, expired at the end of 2013.

The research and development credit, which has long had deep support on both sides of the aisle, has been extended in fits and starts — more than a dozen times in all — since it was first enacted more than 30 years ago.

The measure Ways and Means will mark up on Tuesday is from a bipartisan pair of senior tax writers, Reps. Kevin Brady (R-Texas) and John Larson (D-Conn.), and would increase the rate of the credit.

“Our tax code should encourage business investments, good paying middle class jobs, and the development of technologies we cannot begin to fathom right now,” Cantor said in his memo.

The extension the House will vote on, Cantor added, “will put American companies, especially American manufacturers, on par with their international competitors whom already have permanent R&D incentives.”

Other extenders on the docket for Ways and Means include a provision, commonly known as Section 179, that allows small businesses to quickly write off investments.

Ways and Means will also consider a pair of other small breaks for small businesses: an incentive for S corporations that donate property and another that lowers the tax bill for companies that convert from being corporations.

Finally, the panel will mark up tax breaks that allow multinational corporations to shift certain incomes among subsidiaries without getting taxed, and another that allows financial services companies to defer paying taxes on profits made offshore.