Tax News

CCH (cch.taxgroup.com) reports:

The Senate Finance Committee on September 21 approved the tax titles to two separate pieces of legislation: the American Infrastructure Investment and Improvement Bill, which would reauthorize the Airport and Airway Trust Fund (AATF), and the Habitat and Land Conservation Bill of 2007, which would provide tax incentives for farmers, ranchers, and private landowners. The FAA legislation was approved 16 to 5, and the conservation measure was ordered reported by voice vote.
The FAA mark would reauthorize the AATF through 2011, adding approximately $430 million each year to fund the satellite-based NextGen air traffic system and to fill 2009 shortfalls of approximately $5 billion in the Highway Trust Fund. Approximately $250 million of the additional $400 million in funds will come from General Aviation, or private jets, with the rest provided through commercial carriers. Compensation for a shortfall in the Highway Trust Fund would come through replenishing emergency spending from the fund, suspending transfers from the fund for certain repayments and credits and anti-fuel fraud provisions.
The nearly $3.2 billion in tax provisions found in the Habitat and Land Conservation Bill of 2007 would be used to permanently extend tax incentives for farmers, ranchers and other eligible taxpayers who establish conservation easements and to establish tax credits for taxpayers who take voluntary measures to help protect and restore the habitats of threatened or endangered species. The funds would also be used to cover a tax deduction for the cost of specific actions taken by taxpayers that are recommended in habitat recovery plans approved under the Endangered Species Act.
In addition, the measure would allow taxpayers to exclude from taxable income any payments received from the federal government under certain cost-sharing conservation programs and would extend a provision to allow taxpayers to fully deduct the costs of environmental cleanups in the year the costs are incurred. The cost of the measure is offset by revenues from increasing restrictions on so-called sale-in, lease-out transactions (SILO).
Senate Finance Committee ranking member Charles E. Grassley, R-Iowa, said that, while he supports the conservation legislation, more action is needed in tax law enforcement. "While I am willing to have the committee act on this legislation today, I will not be comfortable with further action until I am confident more has been done to address the ongoing abuses that IRS and Treasury have reported in the area of conservation easements," he said.
Prior to the markup, Senate Finance Committee Chairman Max Baucus, D-Mont., consulted with Finance members on modifications to the original Chairman's Mark of the air and highways bill that was released on September 17. The changes included: authorization for the use of Highway Trust Funds specifically to address the Minnesota I-35 bridge collapse, a Truth in Passenger Tax Disclosures provision preventing airlines from presenting fuel surcharges as government-imposed taxes, a requirement that new accruals in air carrier pension plans must be funded, Liberty Zone incentives for New York City, and exemptions for some shippers from the harbor maintenance tax at U.S. ports in the Great Lakes/St. Lawrence Seaway system. Some technical corrections were included as well. The committee also accepted a fully offset amendment to provide tax credit bonds for rail infrastructure
By Jeff Carlson, CCH News Staff
JCT Description of the Chairman's Modification to the Provisions of the American Infrastructure Investment and Improvement Act, JCX-83-07
JCT Estimated Revenue, General Fund, and Trust Fund Effects of the Chairman's Modification to the American Infrastructure Investment and Improvement Act, JCX-84-07
FAA Reauthorization Act of 2007, as Passed by the House on September 20, 2007, HR 2881
Federal Aviation Administration Extension Act of 2007, as Reported by the House Ways and Means Committee, HR 3540
House Ways and Means Committee Report on the Federal Aviation Administration Extension Act of 2007, HRRepNo 110-337.