Bad news tax planners. The Senate won't act on the tax extenders — those 50 or so temporary individual and corporate tax breaks that must be renewed periodically by Congress — until November.
So if you've been counting on hoping to use any of the extenders in connection with your 2014 taxes, put your tax planning on hold.
That's the official word from Senate Majority Leader Harry Reid.
When asked whether Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act is hopelessly deadlocked until after the mid-term elections, the Nevada Democrat said, "I guess the answer is yes."
EXPIRE, also known as S. 2660, would renew for two years most of the tax provisions that ended Dec. 31, 2013.
The bill was approved by the Senate Finance Committee, and most Senators in both parties approve the extension.
But full Senate consideration ended when Reid refused to allow some Republican amendments to the bill. Irate GOP Senators then blocked continued action on the bill.
Reid and Senate Minority Leader Mitch McConnell (R-Ky.) blamed each other for the impasse.
McConnell said his party wants a "reasonable amendment process" before it will let the $85 billion tax package progress.
Reid, however, sees the loyal opposition as anything but reasonable.
Medical device delay: GOP Senators are insistent on taking another swipe at Obamacare via an extenders amendment that would repeal the medical devices tax.
This 2.3 percent excise tax is assessed manufacturers on most medical devices, such as artificial joints, defibrillators, pacemakers and stents. It was part of the 2010 health care law, but has been bipartisanly unpopular from the get-go.
Republican Senators would love to see Democrats go on record as opposed to this part of health care reform. Such a vote would make a great ad for many GOP candidates seeking to capture seats in the upcoming Congressional elections.
Reid has said he is willing to consider any amendments as long as they directly relate to the tax bill under consideration. That's not the case, he said, with the medical devices tax.
That proposed amendment, said Reid, is a "poison pill" that has "nothing to do with the extenders." Senate Republicans are insisting that they want to vote on this amendment.
Then there's the House: If the Senate waits until after the Nov. 4 votes are tallied, that will give Congress only about eight weeks to work out a deal with the House on extending the expired tax provisions.
That's not going to be easy. Rep. Dave Camp (R-Mich.), chairman of the House Ways and Means Committee, has been insistent on looking at each expired tax break separately rather than in a larger bill like the Senate.
So far the Committee has cleared just a dozen tax provisions for continued inclusion in the Internal Revenue Code.
As for us taxpayers who want to claim such things as the tuition and fees above-the-line deduction, roll over traditional IRA required distributions to a charity or itemize our state and local sales taxes, we'll likely be able to do that for 2014. Any renewal will make the provisions retroactive to Jan. 1.
But filing season 2015 could be delayed again as the Internal Revenue Service must wait for tax laws to be official before it can update tax material and its computer systems.
And as for our personal and buisness tax planning, that's a mess, too. We and our tax advisers have to make two sets of tax moves just in case Congress doesn't do anything at all.
Given the recent history of both chambers, that's not out of the question.
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