WASHINGTON (AP) — In an almost annual ritual, Congress isletting a package of 55 popular tax
breaks expire at the end of theyear, creating uncertainty — once again — for millions of individualsand
businesses.Lawmakers let these tax breaks lapse almost everyyear, even though they save businesses and
individuals billions ofdollars. And almost every year, Congress eventually renews them,retroactively, so
taxpayers can claim them by the time they file theirtax returns.No harm, no foul, right? After all,
taxpayers filingreturns in the spring won’t be hurt because the tax breaks were ineffect for 2013. Taxpayers
won’t be hit until 2015, when they file taxreturns for next year.Not so far. Trade groups and tax
expertscomplain that Congress is making it impossible for businesses andindividuals to plan for the future.
What if lawmakers don’t renew thetax break you depend on? Or what if they change it and you’re no
longereligible?"It’s a totally ridiculous way to run our tax system,"said Rachelle Bernstein, vice
president and tax counsel for the NationalRetail Federation. "It’s impossible to plan when every year
thishappens, but yet business has gotten used to that."Some of thetax breaks are big, including
billions in credits for companies thatinvest in research and development, generous exemptions for
financialinstitutions doing business overseas, and several breaks that letbusinesses write off capital
investments faster.Others are moreobscure, the benefits targeted to film producers, race track owners,makers
of electric motorcycles and teachers who buy classroom supplieswith their own money.There are tax rebates to
Puerto Rico and theVirgin Islands from a tax on rum imported into the United States, and acredit for
expenses related to railroad track maintenance.Adeduction for state and local sales taxes benefits people
who live inthe nine states without state income taxes. Smaller tax breaks benefitcollege students and
commuters who use public transportation.A series of tax breaks promote renewable energy, including a credit
for power companies that produce electricity with windmills.Theannual practice of letting these tax breaks
expire is a symptom adivided, dysfunctional Congress that struggles to pass routinelegislation, said Rep.
John Lewis of Georgia, a senior Democrat on thetax-writing House Ways and Means Committee."It’s not
fair, it’svery hard, it’s very difficult for a business person, a company, toplan, not just for the short
term but to do long-term planning," Lewissaid. "It’s shameful."With Congress on vacation
until January,there is no chance the tax breaks will be renewed before they expire.And there is plenty of
precedent for Congress to let them expire formonths without addressing them. Most recently, they expired at
the endof 2011, and Congress didn’t renew them for the entire year, waitinguntil New Year’s Day 2013 — just
in time for taxpayers to claim them ontheir 2012 returns.But Congress only renewed the package though the
end of 2013.Whysuch a short extension? Washington accounting is partly to blame. Thetwo-year extension
Congress passed in January cost $76 billion inreduced revenue for the government, according to the
nonpartisan JointCommittee on Taxation. Making those tax breaks permanent could add $400billion or more to
the deficit over the next decade.With budgetdeficits already high, many in Congress are reluctant to vote
for a billthat would add so much red ink. So, they do it slowly, one or two yearsat time."More
cynically, some people say, if you just put it infor a year or two, then that keeps the lobbyists having to
come back andwine-and-dine the congressmen to get it extended again, and maybe makesome campaign
contributions," said Mark Luscombe, principal tax analystfor CCH, a consulting firm based in
Riverwoods, Ill.This year,the package of tax breaks has been caught up in a debate aboutoverhauling the
entire tax code. The two top tax writers in Congress —House Ways and Means Committee Chairman Dave Camp,
R-Mich., and SenateFinance Committee Chairman Max Baucus, D-Mont. — have been pushing tosimplify the tax
code by reducing tax breaks and using the additionalrevenue to lower overall tax rates.But their efforts
have yet tobear fruit, leaving both tax reform and the package of temporary breaksin limbo. When asked how
businesses should prepare, given theuncertainty, Camp said: "They need to get on board with tax
reform,that’s what they need to do."Further complicating the issue,President Barack Obama has nominated
Baucus to become U.S. ambassador toChina, meaning he will soon leave the Senate, if he is confirmed by
hiscolleagues.As the Senate wound down its 2013 session, Democraticleaders made a late push to extend many
of the tax breaks by askingRepublican colleagues to pass a package on the floor of the Senatewithout debate
or amendments. Republicans objected, saying it wasn’t aserious offer, and the effort failed.So should
taxpayers count on these breaks as they plan their budgets for 2014?"Thebest thing I would say is,
budget accordingly," said Jackie Perlman,principle tax research analyst at The Tax Institute at
H&R Block."As the saying goes, hope for the best but plan for the worst. Then ifyou get it,
great, that’s a nice perk. But don’t count on it."___Follow Stephen Ohlemacher on Twitter:
http://twitter.com/stephenatapCopyright 2013 The Associated Press. All rightsreserved. This material may not
be published, broadcast, rewritten orredistributed.