Deal Struck on Payroll Tax Cut Extension

GOP, Democrats agree to two-month payroll tax cut extension with slight fix for businesses.

By SHARE

A House GOP leadership aide confirmed that House Speaker John Boehner and Senate Majority Leader Harry Reid reached a deal to extend the payroll tax cut by two months—a deal very close to what the Senate passed last week.

[See the latest political cartoons.]

The difference? The new legislation will ensure that the reporting requirements for businesses remain the same, addressing concerns from payroll reporting experts that a two-month extension will sow confusion for businesses.

"While the two-month extension still falls short of providing the certainty Americans need, this solution will at minimum prevent small businesses from bearing a new administrative burden," the aide said.

The deal will continue a payroll tax cut, extend benefits to the long-term unemployed, and prevent cuts to payments for Medicare doctors until the end of February. It will also force the Obama administration to make a decision on the controversial Keystone Pipeline within 60 days.

[What 'Job Creators' Really Want.]

As part of the deal, Reid will appoint representatives to a conference committee to hammer out a compromise with the House of Representatives on a long-term extension.

Earlier Thursday, a Senate Democratic aide claimed that a conference committee would just be a "sideshow" while the real negotiations happen elsewhere.

aparker@usnews.com

Twitter: @AlexParkerDC