Washington, D.C. - The U.S. House of Representatives today passed a measure that extends important tax incentives currently in place, but ignored the looming tax burden of the Alternative Minimum Tax (AMT) that will ensnare 1.1 million middle class Texas families unless Congress acts this year.

The bill includes some of U.S. Congressman Kevin Brady’s highest tax relief priorities – like the state and local sales tax deduction that saves Texas families $1.2 billion a year – along with renewable energy incentives, a deduction for teachers who buy classroom supplies out of their pockets, the research and development tax credit and college tuition deduction for families. 

“Last year this new Congress put off addressing the AMT until late in the year. That mistake harmed thousands of taxpayers by delaying their refund checks,” noted Brady, who argued Congress was acting irresponsibly by ignoring the AMT. “There is no excuse for refusing to act sooner rather than later, especially since families can’t afford higher taxes.”

The alternative minimum tax is basically a ‘second tax’ to catch families who wouldn’t normally owe taxes.

Brady also opposed the bill because it included tax increases that hurt American companies, as well as a new $1.6 billion tax break for wealthy trial lawyers; a provision that was snuck into the bill, without any study, the night before the legislation was voted on in the Ways and Means Committee. The Treasury Department raised serious concerns about this secret provision, stating it overturns long standing uniform tax accounting principles in order to confer a special tax treatment upon plaintiff’s trial lawyers.

“At a time of war, when our veterans need health care and many families are struggling in this economy, why would Congress sneak through huge new tax breaks for a few wealthy trial attorneys?” asked Brady.

The state and local sales tax deduction would apply for 2008. Brady proposed an amendment in committee to extend it for two years, but it was rejected by Democrats on a party-line vote.