Congress fails to agree tax cut bill

Congressional negotiators failed to reach agreement on a $70 billion tax cut package on Thursday, dashing Republican hopes that they could pass the legislation before Americans file this year's income taxes.

On Thursday morning, House of Representatives Majority Leader John Boehner said congressional negotiators were close to an agreement on the package, which would extend low rates for capital gains and dividends beyond 2008.

But on Thursday evening House officials said the chamber was going home for a spring break without a vote. They declined to provide details on why the deal had failed.

Boehner had said earlier that House and Senate negotiators were working on extending the maximum 15-percent tax rate on capital gains and dividends beyond 2008, when the lower rates are set to expire. Without congressional action, capital gains taxes would jump to 20 percent and dividends would be taxed as regular income.

He said negotiators also wanted to include some relief from the Alternative Minimum Tax, which was originally aimed at only a few of the wealthiest Americans but would hit as many as 20 million taxpayers on their 2006 tax returns if Congress fails to act.

Republican leaders had wanted the bill approved before the two-week spring recess that starts this weekend, to remind Americans of their party's commitment to lower taxes ahead of the April 15 federal income tax filing deadline.