The House, seizing a rare moment of bipartisanship to respond to the economy's slump, overwhelmingly passed a $146 billion aid package Tuesday that would speed rebates of $600-$1,200 to most taxpayers.
The plan, approved 385-35 after little debate, would send at least some kind of rebate to anyone with at least $3,000 in income, with more going to families with children and less going to wealthier taxpayers.
It faced a murky future in the Senate, though, where Democrats and Republicans backed a larger package that adds billions of dollars for senior citizens and the unemployed, and shrinks the rebate to $500 for individuals and $1,000 for couples. That plan, written by Finance Committee Chairman Max Baucus, would deliver checks even to the richest taxpayers, who are disqualified under the House-passed measure.
Both versions would provide tax breaks to businesses to spur equipment and other purchases.
Baucus, D-Mont., planned a Wednesday vote in his committee, and Majority Leader Harry Reid has said he hopes to have it approved by week's end. Congressional leaders are aiming to send the measure to President Bush by Feb. 15.
But the divergent plans - and bids by Senate Democrats and Republicans to swell the package with more add-ons - could drag out that schedule.
Sen. Mitch McConnell, R-Ky., the minority leader, said the Senate should simply pass the House measure, which would send it straight to Bush for his signature.
"This is not a time to get into some kind of testing of wills between the two congressional bodies. This is a time to show we can rise above partisanship, do something important, and do it quickly," McConnell said.
The House plan brought together Democrats and Republicans, both of whom surrendered cherished proposals to reach a deal.
House Speaker Nancy Pelosi, D-Calif., cautioned against adding items that could hinder an economic recovery or scuttle the bipartisan agreement.
"It's important that this bill not get overloaded. I have a full agenda of things I would like to have in the package, but we have to contain the price," Pelosi said. "We made a decision, because that's where we could find our common ground."
Republican leaders, too, described the measure as an imperfect compromise that would provide a needed jolt to the economy.
Americans "expect us to find ways to work together, not reasons to fight with each other," said Rep. John A. Boehner, R-Ohio, who forged the agreement with Pelosi in consultation with Treasury Secretary Henry M. Paulson.
"The sooner we get this relief in the hands of the American people, the sooner they can begin to do their job of being good consumers," Boehner said.
The measure would send rebates to some 111 million people, including roughly 35 million families who don't make enough to pay income taxes. Individuals with adjusted gross income of $75,000 and couples making $150,000 would get rebates equal to the taxes they paid, up to $600 for individuals and $1,200 for couples. Those making more than that would see their rebate go down by 5 percent of every dollar of income over the limits.
Taxpayers would get at least $300, even if they paid less than that in taxes - or $600 for couples. That's also the case for those who don't pay income taxes but earn at least $3,000.
All eligible people would get an additional $300 per child.
In the Senate, Baucus' proposal removes the income caps and would send rebates to some 20 million senior citizens not covered by the House plan because they don't have income.
It also extends unemployment payments for 13 weeks for those whose benefits have run out, with 26 more weeks available in states with the highest jobless rates.
The Senate measure restores a business tax break dropped during the House negotiations that would permit corporations suffering losses now to reclaim taxes previously paid.
Both packages include roughly $50 billion worth of tax incentives for businesses to invest in new plants and equipment.
Baucus said he, too, wanted to avoid burdening his proposal with extras.
"The more that this is kept slimmed down and it's clean and simple, the better. I do not want it loaded up with lots of other provisions," said Baucus, D-Mont. "Nobody wants to be held responsible for stopping this from going through."