On March 10, the Senate voted 62-36 to pass $31 billion in temporary tax breaks and impose new permanent penalties on businesses that try to avoid taxes by using transactions that lack any underlying "economic substance." The bill garnered six Republican votes—Sens. Kit Bond (Mo.), Susan Collins (Maine), Olympia Snowe (Maine), Lisa Murkowski (Alaska), David Vitter (La.) and George Voinovich (Ohio). Sen. Ben Nelson (Neb.) was the only Democrat to vote against the bill.

The American Workers, State, and Business Relief Act of 2010 (H.R. 4213) would extend more than 40 tax breaks that expired at the end of 2009 through 2010. Those breaks include the additional standard deduction for state and local property taxes, the deduction of state and local general sales taxes, the qualified tuition deduction, and tax-free distributions from individual retirement plans for charitable purposes. Businesses also would regain the ability to claim the popular research and experimentation tax credit, the Sub-part F active financing exception, and a 15-year cost recovery provision for improvements to restaurants and retailers.

Most of the cost in the bill approved by the Senate goes toward another extension of federal unemployment insurance benefits, tax credits to subsidize the cost of COBRA health insurance premiums for displaced workers, and a temporary change in pension funding rules to ease some of the financial strain on employers due to the drop in pension values as the stock market softened. The bill also extends the current rate of Medicare payments to doctors, who are scheduled to see a 21 percent rate cut. The cost of these extensions is approximately $80 billion.

Democrats said the extended unemployment benefits would provide relief to Americans out of work and a boost to economy, since recipients would be sure to spend them.

The bill raises nearly $40 billion in new revenue to offset some of the cost by cutting back on a biofuel tax break used by the paper industry and by tightening tax shelter rules. It is important to note that the revenue raisers in the Senate bill are already included in the health care reform proposal favored by President Barack Obama.

Meanwhile, the Republicans who voted no said it would add more than $100 billion to the deficit, which the administration expects to hit a record $1.56 trillion this year.

H.R. 4213 was built significantly on an earlier version passed by the House in Dec. 2009, however due to technical changes by the Senate it must now be sent back across the Capitol before it can go to the president's desk for his signature.