Conference on tax reconciliation bill finally begins

In mid-March the conference committee on the $70 billion package of tax cut extensions finally met for the first time. The delay stemmed from an item included in the House version of the bill that would extend for two years the lower favorable rates on capital gains and dividends. That would have resulted in a budgetary impact that would have triggered a Senate rule which would have allowed a point of order to be raised against the final conference report. The conferees have begun looking at ways to include in the bill enough revenue-raising provisions to offset the cost to the Treasury of the lower capital gain and dividend rate extensions. In the bill, the conferees have to deal with dividend and capital gain tax rates, AMT relief and whether or not to extend such items as the research credit, the work opportunity tax credit and the deduction for teachers' classroom expenses. Stay tuned.