House Passes Tax Cut Extension; Bill Headed for Obama's Desk

VIDEO: Congressional passage of tax plan extends Bush-era tax cuts for two more
WATCH Next Stop for Tax Plan: Obama's Desk

After months of heated debate, backroom arm-twisting and White House negotiations, just before midnight the House of Representatives finally passed a $858 billion tax cuts package, including a two-year extension on all of the Bush-era Tax Cuts, a 13-month extension for unemployment insurance benefits, and approval of the controversial estate tax break that gives 6600 families a break worth $23 billion.

The compromise that President Obama negotiated with GOP leaders in Congress to avoid a tax-increase on Jan. 1 passed by a healthy, bipartisan vote -- 277-148, with more Democrats (139) actually voting in favor of the deal than Republicans (138).

The bill now heads to the White House for President Obama's signature.

Following the vote, Speaker-designate John Boehner commended his colleagues for passing the legislation and called on President Obama to work with Republicans in the next Congress to create more jobs.

"With nearly one in 10 Americans out of work, acting to ensure no American's taxes go up on Jan. 1 was critically important. Failing to stop all the tax hikes would have destroyed more jobs and deepened the uncertainty in our economy," Boehner stated. "Stopping all the tax hikes is a good first step in our efforts to reduce the uncertainty family-owned small businesses are facing, but much more needs to be done, including cutting spending, permanently eliminating the threat of job-killing tax hikes, and repealing the job-killing health care law. These are critical priorities the new majority has pledged to act on in the next Congress, and I hope President Obama will listen to the American people and work with us to stop Washington's job-killing policies."

Pomeroy Amendment Falls Short

Just before the vote on final passage, the Pomeroy Amendment failed to get enough support to change the estate tax provision and send the package back to the Senate, falling short by a vote of 194-233 and one member voting "present."

The amendment would have changed the Senate's $5 million estate tax exemption ($10 million total for a married couple) and a maximum rate of 35 percent to $3.5 million ($7 million total for a married couple) and the maximum tax rate on estates to 45 percent.

Sixty House Democrats stuck with the President, opposing changes to the compromise he struck with Republican leadership. Zero House Republicans voted in favor of the amendment.

Majority Leader Steny Hoyer voted for both the Pomeroy amendment and final passage on the bill, admitting that while he does not believe it's a perfect bill, Congress needed to act for the benefit of struggling Americans.

"There probably is nobody on this floor who likes this bill, so the judgment is, is it better than doing nothing?" Hoyer asked moments before the vote.

House Minority Whip Eric Cantor, R-Virginia, warned colleagues against voting down President Obama's compromise, because in the next session of Congress, in the face of a divided government, Republicans probably would not be able to get as good of a deal.

"While it's not a perfect bill, this is the kind of action that most Americans voted for last November," Cantor said. "We could try to hold out and pass a different tax bill next year, but there's no reason to believe that the Senate would pass it or that the President would sign it if it spills into next year."