Senate OKs One-Year Extender Bill With Economic Substance Provision

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The Senate passes, 62-36, a one-year extension of $31 billion in popular tax breaks with a permanent codification of the economic substance doctrine and new penalties on firms using transactions structured for no purpose other than tax avoidance. The bill (H.R. 4213) also would close a tax loophole that could allow paper manufacturers to claim a $1.01 per gallon tax credit for their use of “black liquor” to power their plants.