Tax Relief
The American Recovery and Reinvestment Act of 2009 includes $287 billion in tax relief. The goals of this plan are to jump start the economy and create jobs for Americans in an accountable, transparent manner.
The American Recovery and Reinvestment Act of 2009 includes $287 billion in tax relief. The goals of this plan are to jump start the economy and create jobs for Americans in an accountable, transparent manner.
Economic Recovery Tax Relief |
10 Year Cost |
$287 billion |
|
Tax Relief for Individuals |
$232.4 billion |
Make Work Pay Credit -- $400 for singles, $800 for couples for 2009 and 2010. Phase-out at begins at $75,000 and $150,000 |
$116 billion |
EITC - temporary increase for 2009 and 2010 |
$4.6 billion |
Child Tax Credit -- Reduce earnings threshold for refundable portion to $3,000 for 2009 and 2010 |
$14.8 billion |
American Opportunity Tax Credit -- amends HOPE scholarship credit for 2009 and 2010 so that it is available for 4 years at a rate of 100% of first $2,000 in expenses and 25% of next $2,000, with income phase outs at $80,000/$160,000. Includes some refundability provisions. Make textbooks a qualifying expense. Allow against AMT. Make 40% of AOTC refundable ($3.6 billion). |
$14.1 billion |
First Time Homebuyers Credit -- $8,000, eliminates repayment requirement unless home sold in first three years. |
$6.5 billion |
Exempt Unemployment Benefits from Income Tax -- Up to $2,400 for 2009 exempt. |
$4.7 billion |
Tax Relief for Individuals |
|
AMT Relief for 2009 -- Increases individual AMT exemption to $46,700 ($70,950 joint) and allow personal credits against AMT. |
$70 billion |
Sales Tax Deduction for Automobile Purchase -- Up to $49,500 in value of purchase, phase-out at $125,000 ($250,000 joint) AGI. |
$1.7 billion |
Tax Rebates for Seniors and Disabled -- $250 for SSA, SSI, railroad retirees and veterans disability recipients in 2009. $250 refundable credit for state and federal pensioners not eligible for social security ($218 million). NOT INCLUDED IN TOTAL ABOVE - TECHNICALLY THIS IS A SPENDING PROVISION. |
$14.2 billion |
Tax Incentives for Business |
$14.5 billion |
Accelerated Depreciation for 2009 -- continues for tax year 2009 the provision enacted as part of last year's stimulus bill - it actually has a $6 billion ten year costs as receipts increase on the back end. |
$39 billion over 2 years. |
Net Operating Loss -- 5-year carryback for 2008 NOL for businesses with gross receipts under $15 million. Treatment of certain ownership changes of manufacturing firms for purposes of limiting NOL and certain built in losses ($2.5 billion) |
$3.5 billion |
Deferral of Certain Income from Indebtedness -- ($5 billion over ten years) |
$41 billion over 3 years. |
Renewable Energy Incentives |
$17.8 billion |
Renewable Electricity Credit -- extends for 3 years the placed-in-service date for each section 45 facility, excluding coal and solar |
$11.3 billion |
Extension and Modification of Credit for Nonbusiness Energy Property -- extension and 30% ($1,500 per residence cap) increase for expenditures between 12/31/08 and 1/1/11. |
$2 billion |
Manufacturing Incentives -- credit for investment in advanced energy property ($2.3 billion of credits to allocate). |
$1.6 billion |
Election of Investment Credit in Lieu of Production Credits -- |
$285 million |
Increased Limit on Qualified Energy Conservation Bonds ($1.6B allocation) and Qualified Energy Conservation Bonds ($2.4B allocation) |
$1.2 billion |
Alternative Motor Vehicle Credit -- and plug-in modification to existing credit. |
$1.4 billion |
Local Government Assistance |
$22.4 billion |
Delays for one year the 3% withholding on government contracts |
$300 million |
Taxable Bond Option for government (Build America Bonds) -- 35% credit to bondholders for 2009 and 2010; 35% refundable credit to issuers for bonds issued in 2009 and 2010 (for obligations issued after date of enactment). Allows the State or local government to elect to receive a direct payment from the Federal government equal to the subsidy that would have otherwise been delivered through the Federal tax credit for bonds. |
$3.9 billion |
Recovery Zone Bonds -- $15 billion private activity bond allocation (CA share would be about 12%); $10 billion allocation for refundable issuer credit bonds, credit rate of 45% |
$4.8 billion |
Qualified School Construction Bonds - ($11 billion in 2009 and 2010) |
$8.6 billion |
Modification to Rules for Financial Institutions -- changes interest expense rules related to tax exempt income - 12/31/08 through 1/1/11 |
$2.9 billion |
Low Income Housing Tax Credit -- creates grant program to states for low income housing in lieu of low-income housing credit allocations for 2009 |
$1.8 billion |