The American Jobs and Closing Tax Loopholes Act will be released Thursday as the House Amendment to the Senate Amendment to H.R. 4213, the two said.

The bill extends several popular individual and business tax breaks, which are partly paid for by increasing taxes on a common form of income used by hedge fund managers to pay themselves. Levin and Baucus reached a compromise on how to tax "carried interest" which had been a divisive issue for years. Read on...

FACTBOX-U.S. tax, jobs bill targets fund managers:

The bill's total net cost, now at $31 billion, has been trimmed by Democrats several times to gain support from fiscally conservative Democrats.

... It would extend unemployment benefits that are set to expire at the end of the month for hundreds of thousands of Americans, tighten tax rules for multinational companies and renew a set of popular business tax breaks that expired last year.

Final action on the total package will have to wait until Congress returns from its recess on June 7, as the Senate was not expected to approve the bill before then.

... FUND MANAGER TAXES

The tax would hit the typical 20 percent share of profits that fund managers reap for managing money, known as carried interest. Fund managers, who can earn millions of dollars in a good year, pay a long-term capital gains tax rate of only 15 percent on their share of profits.

The bill proposes to treat 75 percent of those profits as ordinary income, a 35 percent tax rate for the highest earners. Until 2013, 50 percent of the profits will be treated as ordinary income.

The tax change would affect private-equity, venture-capital, real-estate and hedge funds, and has passed the House three times. It has yet to gain traction in the Senate.

The bill also slaps a 40 percent penalty on those caught attempting to skirt the taxes.

Revenue raised: $18 billion.

... BUSINESS TAX BREAKS

The bill renews a set of popular tax breaks for business and individuals, the biggest being the research and development tax credit used by major Fortune 500 companies. Other benefits extended include a tax credit for the use of biodiesel and renewable diesel and accelerated depreciation for certain business improvements. Cost: $32 billion

OIL COMPANIES, SPILL CLEANUP

The bill would boost the amount oil companies pay into a trust fund that pays economic damages from oil spills, to 34 cents a barrel from the current 8 cents a barrel.

The bill would also raise the $1 billion per incident limit on certain claims against the federal Oil Spill Liability Trust Fund to $5 billion. The fund was authorized for use in the aftermath of the Exxon Mobil Corp Valdez spill.