Senator Max Baucus of Montana, chairman of the Senate Finance Committee, says he’s had it with extenders. These are tax benefits that have expiration dates but regularly get renewed, usually for a period of just a year or two. Individuals rely on a number of these, such as the itemized deductions for state and local sales tax and private mortgage insurance (PMI). Several of them are important to businesses as well.
In theory, the expiration dates offer Congress an opportunity to review these tax benefits and determine which ones should be made permanent and which should be allowed to expire. In practice, when the expiration dates arrive Congress simply extends them for another year or two — which is why they’ve become known as extenders. Occasionally they’ve been caught up in year-end political squabbles, leading to uncertainty as to whether they’ll be extended. If a stalemate goes on too long it can interfere with the income tax filing season, delaying refunds and wasting government resources in the scramble to deal with last-minute changes.
Enough is enough, according to Baucus, who told Tax Analysts he wants to see Congress decide which of these provisions should be permanent and which should be eliminated, and do this in the context of tax reform legislation. He says he doesn’t plan to have the Finance Committee mark up a separate extenders bill this year. It remains to be seen how this will play out if tax reform legislation fails to gain traction.
- Baucus has announced he will not seek re-election in 2014.