Cutting Taxes for Washington Families and Businesses

(Washington,
D.C.) – This week, the U.S. Senate began consideration of the American Jobs
and Closing Tax Loopholes Act a bill that contains critical support for
Washington state’s families, businesses, infrastructure, and
economy.  

“This
bill provides timely and needed support for Washington state’s economy and
families,” said Senator Murray. “It
incentivizes businesses to grow, provides Medicaid assistance to help avoid
another budget crisis, and gives Washington taxpayers the fairness they
deserve. While our economy may not be getting worse, we still have a lot of
work to do to ensure it gets better. This bill keeps our focus on boosting
local economies, creating jobs, and keeping our economic recovery going.”

Provisions
that will help Washington state’s families and economy include:

TAX CUTS FOR WASHINGTON STATE
FAMILIES:

• Deduction
  of state and local sales taxes for Washington residents –The bill will allow Washington
  residents to continue to deduct state and local taxes on their federal tax
  returns.  The sales tax deduction is meant to ensure that Washington
  taxpayers are treated fairly as other taxpayers from other states. The
  provision also provides certainty to Washington families so that they can plan
  their financial future. The deduction saves Washington taxpayers over $500
  million each year.

• Classroom expense deduction for Washington state teachers – The bill will provide
  teachers with a federal tax deduction for out-of-pocket expenses for
  instructional materials and classroom supplies.

• College tuition deduction – The bill will increase the amount Washington
  students and their families can deduct for tuition and education expenses from
  their taxes.

TAX CUTS AND SUPPORT FOR WASHINGTON
STATE BUSINESSES:

• Tax
  Cut for Hiring Washington State Military Reservists – The bill extends a tax cut for
  Washington state small businesses that continue to pay employees who have been
  called to active duty, so these businesses can continue to support these jobs.

• Research
  and Development Tax Credit for Innovative Washington Businesses – The bill extends a tax cut for
  research and development to help Washington state businesses spur innovation
  and grow.

• Biodiesel
  and Renewable Tax Credits for Washington state Producers – The bill extends a tax cut for
  Washington state’s biodiesel and renewable diesel produce, which will support
  energy independence and create jobs.

• Tax
  Credit for Equipment Investments
  – The legislation allows Washington state companies to receive tax refunds on a
  portion of their Alternative Minimum Tax (AMT) credits if they invest in
  capital equipment for use in the United States.

• Tax
  Benefits for Capital Investmentsby Washington Businesses – The legislation extends tax cuts for
  Washington businesses that will encourage construction and improvements -
  supporting construction jobs, encouraging economic development and saving these
  businesses money they can use to reinvest in their companies and hire new
  workers.

• Small Business Administration Loans – The
  bill would extend the small business lending program that eliminates the fees
  normally charged for loans through the SBA 7(a) and 504 loan programs and
  increases the government guarantees on 7(a) loans from 75% to 90%.  Since
  its creation, the program has supported over $26 billion in small business
  lending nationwide, which has helped to create or retain over 650,000 jobs.
  

• Tax
  Cut for Investing in Low-Income Washington Communities – The bill extends the New Markets
  Tax Credit, a tax cut for private investment in low-income Washington state
  communities, bolstering local economies and creating jobs where they are needed
  the most.

SUMMER JOBS:

Senator
Murray worked to include a provision in the bill that will continue the
successful summer jobs program she included in the American Recovery and
Reinvestment Act for the upcoming summer. The provision is expected to support
over 300,000 jobs for youth ages 16 to 24 in the most difficult job markets
young people have faced in the last 50 years. Funding for the program will
allow local Workforce Investment Boards in Washington state to continue a
program that created 5,000 work opportunities for young people across
Washington state last summer.

MEDICAID ASSISTANCE FOR
WASHINGTON STATE:

The bill includes an extension of federal medical assistance percentage
(FMAP) support for Washington state which will help the
state afford the rising cost of providing Medicaid that has come with increased
enrollment, rising unemployment, and lower tax receipts. This funding would
help avoid a special session of the state legislature in which tax
increases and across the board cuts to jobs, health care, and our economic
recovery would have to be considered.

UNEMPLOYMENT EXTENSION:

The bill
includes an extension of federal unemployment insurance to assist the over
260,000 Washington state residents currently receiving unemployment, or those
who will apply in the future, through November 2010. Many Washington residents
continue to struggle to find work after losing their jobs, through no fault of their
own during the economic recession.