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Taxpayers Get A Break In Package Passed By Senate

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The Associated Press

Published: September 24, 2008

WASHINGTON - The Senate passed a giant tax package Tuesday that saves more than 20 million taxpayers from the bite of the alternative minimum tax.

At a cost of more than $100 billion, the bill also nudges the nation toward greater use of alternative energy resources, renews popular tax breaks for businesses and individuals, and extends relief to disaster victims.

It includes a provision to ensure that mental health problems get the same level of insurance benefits as other medical treatment. The bill passed 93-2.

"The economy is struggling," said Senate Finance Committee Chairman Max Baucus, D-Mont. "At times like these, Americans need tax cuts that they've come to count on, that can help them get by."

The tax bill is one of several major efforts to right the teetering economy in what could be the final week of this session of Congress. Lawmakers are trying to reach agreement on a $700 billion plan to bail out failing financial institutions, and Democrats are trying to put together a stimulus package to help average citizens get through the current economic crisis.

The House was expected to take up the tax package today.

The alternative minimum tax was enacted in 1969 to catch a few very rich tax dodgers. But it was never adjusted for inflation, and Congress must act every year to ensure that it doesn't catch more people.

Without action, those affected could grow from about 4 million to 25 million, at an average tax increase of $2,000.

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