Senate Democrats Celebrate Payroll Tax Cut Deal

Senate Democrats are celebrating this evening that the House of Representatives l ooks to be headed toward passing the two-month payroll tax extension tomorrow.

"I am grateful that the voices of reason have prevailed and Speaker Boehner has agreed to pass the Senate's bipartisan compromise," Senate Majority Leader Harry Reid, D-Nev., said in a paper statement tonight. "Year-long extensions of the payroll tax cut, unemployment insurance and Medicare payments for physicians has always been our goal, and Democrats will not rest until we have passed them."

MAINBAR: House Republicans Cave on Payroll Tax Cut

Reid says he looks forward to appointing members of his caucus to continue negotiations in conference but does not give a definite time when he'd appoint conferees nor when they would start working.

"Two months is not a long time, and I expect the negotiators to work expeditiously to forge year-long extensions of these critical policies," Reid says.

In an on-camera interview from New York with CNN this evening, Sen. Chuck Schumer, D-N.Y., similarly celebrated the deal.

"We are very glad because it's a win for the American people," Schumer said. "We're glad the House has come to its senses and basically passed the Senate bill."

Schumer called the House technical correction a "good one," but said overall it's the Senate bill that remains "largely intact."

The Senate bill had included a wage cap of $18,350 to ensure that no one received more than two months of benefit from the payroll tax holiday, preventing manipulation of an employee's pay to maximize the payroll tax relief should the holiday not be extended beyond two months.

That cap created some difficulty for payroll processors. The technical correction made by the House removes the wage cap and in its place creates an excise tax on "excise payroll tax relief" during the two-month extension.

The Senate will likely move first on this tomorrow during their "pro forma" session.  The Senate will ask for Unanimous Consent on a provision that says their action is contingent on the House following through. This means if the House of Representatives passes their bill through tomorrow, without a hitch in the plan, then the bill could be sent then to the president.