by Noam N. Levey
First-time home-buyers would get a larger tax break. Laid-off workers would receive higher unemployment benefits and new subsidies for heath insurance.
And all but the wealthiest workers would soon get a tax credit worth as much as $800 per couple.
Bigger government checks -- long favored by lawmakers in an ailing economy -- could soon begin landing in mailboxes across the country, and new tax breaks would be available to many families, if the economic stimulus package clears Congress this week.
The $789-billion compromise worked out by House and Senate negotiators Wednesday contains a long list of new ways that Americans can get money from Washington as they struggle through the worsening recession.
Below are some provisions of the bill, which must still be approved by the House and Senate before being sent to President Obama for his signature.
Taxpayers
For most Americans, aid would show up most directly in a simple tax credit.
Workers making less than $75,000 a year would get a $400 credit for 2009 and 2010. Couples making up to $150,000 would get $800.
Higher-income taxpayers would see smaller credits. Individuals making more than $100,000 a year and couples making more than $200,000 would not get the credit.
In addition, 24 million middle-income Americans would be spared from paying higher income taxes under the alternative minimum tax.
The tax was originally designed to apply only to the wealthiest Americans, but it was never indexed for inflation, so larger numbers of taxpayers have been required to pay it.
Home-buyers and homeowners
First-time home-buyers could qualify for an $8,000 tax credit.
The credit is slightly larger than the $7,500 credit in existing law, but it is substantially less than a proposal in the Senate bill that would have boosted the credit to $15,000 and broadened the eligibility.
In addition, the compromise bill waives a requirement that the tax credit be repaid. The credit applies only to homes bought between Jan. 1 and Aug. 31 of this year.
Homeowners who install new doors, windows or furnaces to make their home more energy efficient would be able to get as much as $1,500 back through new tax breaks.
College students
Many people paying for college would get a $2,500 tax credit for tuition and other education-related expenses, such as books and computers.
Eligible college students would also receive higher Pell Grants, thanks to a $400 boost in the maximum grant, to $5,250.
People affected by the downturn
Reflecting the priorities of the Obama administration and the Democratic Congress, the most direct aid in the package would go to low-income people and others struggling in the economic downturn.
Millions of Americans receiving unemployment benefits would see a $25 increase in their weekly checks, up from the average benefit of $200.
Unemployment benefits would last 46 weeks under the deal, up from 26 weeks. Some people in high-unemployment states, including California, could receive benefits for 59 weeks.
People who lose a job would receive help in retaining their employer-sponsored health insurance.
Under current COBRA law, jobless workers can keep their insurance if they pay the full cost of the premium, which can exceed $1,000 a month for a family.
Under the stimulus bill, the federal government would pay 60% of that premium for nine months. Individuals who earned more than $125,000 a year and couples with incomes greater than $250,000 would not be eligible.
Those eligible for food stamps would see a 13.6% boost in what they receive.
The compromise has benefits for other people who receive government income: Disabled veterans and millions of other low-income and elderly people who rely on Supplemental Security Income would get one extra check for $250.
Other programs
More indirectly, millions of the nation's poorest residents would get help as states use billions of dollars in new federal aid to maintain Medicaid, special education and Head Start programs.
State and local government employees, many of whom are facing layoffs as states slash budgets, may get to keep their jobs.
Doctors, nurses and hospitals that often wait months for the government to pick up the tab for Medicaid patients could see some relief.
Comments
Well of course there would be a change of opinion from CAT. I had my questions after seeing the Senate plan too! No money for new schools?!?! Yeah, that effects CAT big time. So, that school thing now got added in arbitration.....still shakes everyone's confidence though. Plus, CAT will only hire new workers when the sales orders come in. Hopefully the paultry amount in this bill going for infustructure will actually do a little boost for the trades.
Posted by: Xcellentform | February 12, 2009 8:44 AM
lame...very lame. Our check went from $1,000 to $800 and now from another source I see $400! Washington is so short sighted! What will $400 do to help my family? Pay the electric bill for one month? Price tag for that, $790 billion!
Posted by: Kelly | February 12, 2009 8:48 AM
Great! 13 dollars extra a week for about 30 weeks! Tax credit for that new house we can all afford. Wait until the new energy policies result in this summer gas prices at 4 bucks or higher and see those "stimulus" dollars go right in the tank. How about those construction jobs going to illegal workers since the dropped E-verify and with new stimulus money illegals are massing at the new open border, liberal welcome wagon. Thats close to 20%. Can't wait to see all the details, since we get to review it for 5 days right? All on the ole' credit card. Think of the money as a million a second; 1M is 1 1/2 days, 1B is 3 1/2 years, 800B is 24,800 years! Get the big picture how much this pork pack costs? And you poor liberals lefties get a few crumbs for your vote and change you can believe in. He has dropped the "hope", now its gloom, doom, depression, and catastrophe. Be happy, you won, take those extra dollars to the bank. Oh, I forgot, you have to buy that bank first for a few trillion. Sweet dreams!
P.S.: I almost forgot the most important part! It's Bush's fault!
Posted by: Bubba Porter | February 12, 2009 9:36 AM
If you take the above headline and article seriously (hint: it shouldn't be taken seriously), then this is truly a magical bill--all benefit, no downside.
Could it just possibly be that some people may not benefit? Like, for example, anyone who pays taxes (which means Obama's cabinet need not worry). Why no mention of any downside?
The bill will borrow $13 for every $10 in goodies it dispenses. And that $13 will be paid for by us taxpayers in the next decade. Pay $13 to get $10..... Even with the new math, that doesn't sound like Americans will be better off.
Posted by: Inconvenient Truth | February 12, 2009 9:46 AM
Thank you for distilling this mess into common language - it helps dramatically.
However, at the risk of sounding petty, there is a typo - "health" in: "Laid-off workers would receive higher unemployment benefits and new subsidies for heath insurance."
Posted by: Tom | February 12, 2009 10:38 AM
This bill came out pretty good. I am quite happy all the tax cuts that favored the wealthy were taken out.
I am very excited to see the results of the stimulus. I wish the so-called fiscal conservatives who respond to these posts would have spent more time wondering how much the Iraq War (over 1 trillion) would have cost us before they started it. I also wish they would have objected to the Bush tax cuts (1.3 trillion) when they had the chance.
Debt is not always bad. Many times people go into debt to make necessary improvements on their home or pay for education. The Iraq War for which the US gains nothing is bad debt. The stimulus which helps rebuild our infrastructure and paves the way for a more energy efficient society is good.
Posted by: Lolis | February 12, 2009 10:59 AM
Good summary thanks
What I wonder is who made this arbitrary $250,000 for couples. So I went to College for 4 years and my wife had 10 years of College and post-graduate degree's. We have over 300K in College debt that we are paying, we have a house loan that we are paying. We lived cheaply for years and rented because we couldn't buy (because the idiots drove up prices of homes). Now we live in one of the costliest places in the country so we make more money but are paying back what got us here plus we walk out of the grocery store with five regular items and a $60 bill because it is frickin expensive to live here. So some other dude decided to get in over his head and he/she is the one that not only gets bailed out, but is asked if they want the extra ice cream with their dessert......... Can't believe it
Posted by: Mike Smith | February 12, 2009 11:24 AM
I agree with lolis. Why do conservatives seem to ignore what got us in this mess in the first place? Give Obama time to straighten out this mess......"Rome wasn't built in a day!"
Posted by: Sherri K | February 12, 2009 2:22 PM
Congress is pushing the stimulus through way too quickly.
With TARP we had a similar amount of urgency to pass a bailout for the banks and it turns out that the banks irresponsibly used the money to pay themselves bonuses for running their companies into the ground.
See what happens when government messes with the free markets? These companies were rewarded for their bad behavior.
As shameful as this activity was the government should have anticipated that Wall Street and the law of greed would need a check on it to make sure the bailout money was being spent in a worthwhile manner.
See what happens when we make decisions too quickly?
$789 billion is a lot of money to spend without much forethought and planning.
The goal of "creating or saving 3.5 million jobs" is worthy one, but exactly how is this going to be done?
Congress and President Obama have not satisfactorily explained how this bill is going to save and create jobs. Instead we are faced with inflammatory rhetoric saying that if we do not act now, we will be facing a catastrophe.
The whole idea behind our government is that drastic plans of actions need to be carefully scrutinized and not undertaken in a fear driven frenzy.
Dan Decker
http://www.weeklypoint.com
Posted by: Dan D. | February 12, 2009 5:57 PM
will everyone get a tax refund like they did last year? if not why?
Posted by: MARY MCLENDON | February 19, 2009 12:59 AM