Tax extenders -- the term given to provisions in the tax code that, if not renewed every year or two, will expire -- were the subject of a recent hearing of the U.S. Senate Finance Committee.
More than 130 extenders, from the R&D credit to deductions for state and local taxes, currently clutter the tax code, Senator Max Baucus (D-Mont.), ranking member of the Committee, said at the hearing. The uncertainty they create causes hassles for both homeowners and businesses. "For businesses to succeed, Congress must provide a stable and certain tax code," Baucus said.
Moreover, deciding whether to renew the extenders, and if so, how to cover the income foregone, takes Congress away from other issues. And, giving deductions or credits to certain groups of taxpayers means that taxes elsewhere have to go up, or expenditures down. Then, there's a philosophical argument: "If a provision is worthy of being in the tax code, then it generally should be made permanent," Senator Orrin Hatch (R-Utah), also a ranking member, stated.