WASHINGTON, Dec 5 (Reuters) - The U.S. Congress is rushing to complete work on several issues affecting Americans’ pocketbooks before lawmakers adjourn for the year.
Topping the list for many is a payroll tax break set to expire on Dec. 31. If it is not renewed, a typical family in the United States would see their taxes increase by about $1,000 next year.
At a time when a struggling economy has helped to push Congress’s approval rating to a record low of less than 10 percent, Democrats and Republicans are struggling to find common ground on how to cover the projected $110 billion annual cost of renewing the tax break.
Some Republicans oppose the extension, saying it eventually could take needed funds from the Social Security retirement program. Democrats disagree.
Here’s a look at key issues facing Congress before it adjourns this month:
Federal unemployment insurance programs also are set to begin expiring at the end of this month, potentially affecting millions of jobless Americans.
Again, the debate in Congress concerns how to pay for extending the benefits, projected to cost about $50 billion a year. Democrats and Republicans are expected to cut a deal — perhaps as part of an agreement on renewing the payroll tax cut.
House Republicans want to tie a renewal of the payroll tax break to their demands to accelerate approval of the proposed Keystone XL pipeline between the United States and Canada.
The White House has put off a decision on the project until after next year’s presidential and congressional elections.
When complete, the pipeline would deliver about 700,000 barrels a day of crude from the oil sands in the Canadian province of Alberta to refineries on the U.S. Gulf Coast.
Republicans see the pipeline as a boon for jobs and energy, while environmentalists oppose it because of concerns about greenhouse gas emissions and possible spills.
Congress passed spending bills for a range of departments including housing, agriculture, transportation and justice for the remainder of this fiscal year, which ends Oct. 1, 2012.
But funding for the rest of the U.S. government must be approved by Dec. 16. Those government functions include defense, homeland security, labor, foreign affairs and health.
Failure to reach a funding agreement would cause a partial government shutdown, which all sides would like to avoid given the fragile economy and widespread disdain for Congress.
Congress faces another Dec. 31 deadline for deciding whether to prevent a 27 percent pay cut for Medicare reimbursements to doctors.
Lawmakers repeatedly have avoided tackling a long-term fix for the reimbursement formula for Medicare, the increasingly expensive U.S. health program for those age 65 and older. Instead, lawmakers typically have opted for short-term solutions. They are expected to do so again.
Congress may allow several tax breaks to expire at year’s end, at least temporarily, as it pushes to increase revenues and decrease the record $15 trillion U.S. debt.
These expiring tax breaks include deductions for state and local sales taxes and college tuition as well as a research and development tax credit for businesses.
A major item is a pending fix for the alternative minimum tax. It’s designed to prevent millions of middle-class income earners from paying the tax that was meant to ensure that the nation’s wealthiest people pay at least some taxes.
Congress is likely to delay action. Lawmakers can put off the issue until taxpayers begin filing 2012 tax returns in January 2013.
House and Senate negotiators are trying to resolve differences between their defense authorization bills, which contain provisions opposed by the President Barack Obama’s administration.
The Senate version, for example, would broaden the military’s responsibility for holding terror suspects.
The Senate bill would also impose new sanctions on the Central Bank of Iran. A similar measure has passed a House committee and may soon be considered by the full House.
The administration doesn’t like the proposed sanctions, saying it prefers to work in a calibrated manner to avoid roiling oil markets or antagonizing allies.