Follow Barack Obama prior and during his tenure as the 44th President of the United States. Read about my personal observations along with every day facts as they happen. This blog will only submit factual information about the first black President, now in his 2nd term of office.


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Congress finalizes the Economic Recovery Plan - Some of What's added, What's changed.

Thursday, February 12, 2009

As reported on, the Congress has finalized the economic recovery plan. Now all that is needed is a final draft for President Obama to sign.
What is interesting here is the agreed dollar amount - $789.5 billion.

The House passed a $820 billion figure.
The Senate passed a $838 billion figure.

So what else was cut out to bring it down to $789.5 billion. Was it necessary?

According to CNNMoney, 'The compromises that the House, Senate and White House made have changed the scope of a number of provisions, including those affecting individuals directly. In some cases, they either reduced or expanded a benefit relative to what appeared in the Senate or House versions of the bill.'
The bill is so large and complicated, and some of the information below published here on this blog  'is based on materials put out by the key committees in the House and Senate as well as House Speaker Nancy Pelosi, D-Calif.' compliments of CNN Money.

Making Work Pay Credit:
$400 credit per worker and an $800 credit per dual-earner couple. The hitch... You must make a combination of $75,000 or less or $150,000 or less per dual-filer couple.
One of the provisions in the bill would allow low income families that can't pay taxes will also be able to qualify. I'll bet that will make higher income people cringe when they hear that. Cost - $116 billion.

One Time payments for people who don't work : At a cost of $14.2 billion, people who are retired, or disabled and others who don't work, would qualify for a one-time $250 payment.

Break for higher income families: A one-year provision to protect middle and upper middle income families from having to pay the Alternative Minimum Tax. It was primarily intended for high-income taxpayers, but within recent years has threatened to affect those lower down the income scale. Cost - 470 billion.

Temporary deduction for car buyers:(2009 & 2010 only) If you buy a new car, or light vehicle, or recreational vehicle or motorcycle in 2009, you can deduct state and local sales taxes along with any excise taxes charged in your purchase. This deduction would be available if your income was less than $125,000 or $250,000 for joint filers. Cost $1.7 billion.

Temporary Credit for home buyers: (2009 & 2010 only) A refundable first-time buyer home credit of up to $8,000, just $500 more than the previous set value. Now you can stay in the home more than 3 years and you don't have to pay the credit back as you had to earlier. Full credit is for those making $75,000 or less or $150,000 for joint filers.

New Temporary College Credit: (2009 & 2010 only) A net tax credit known as the American Opportunity Tax Credit, takes effect this year and next year. The existing Hope Scholarship tax credit only covered $1,800 in higher education expenses, but now would be worth as much as $2,500. You have to make less than $80,000 or $160,000 for joint filers. You would get a partial credit if you were making between those amounts. Cost - $13.9 Billion.

Temporary Pell Grant Increase: (2009 & 2010 only) The original grant was only $500. Now, in 2009, it will be $5,350, and in 2010 will be $5,550. The cost $15.6 billion.

Temporary expansion of child tax credit: (2009 & 2010 only) Eligibility is increased for child tax credit, as the income threshold is lowered to qualify for credit to be refundable. In 2009 and 2010, it would be $3,000.  Cost: $14.8 billion.

Temporary increase in earned income tax credit: (2009 & 2010 only) Increased to 45% from 40% of qualifying earnings for low-income families with three or more children. It also includes a marriage penalty relief provision for couples who qualify for at least a portion of the credit. Cost $4.6 billion.

Health insurance help for the jobless: Jobless workers would receive help to pay Cobra benefits. If you don't receive Cobra now or in the future, then you will not be eligible. If you became unemployed between Sept. 1, 2008 and Dec. 31, 2009, the government will subsidize 65% of their premiums under Cobra for up to 9 months. If you haven't signed up for Cobra yet and you were laid off between Sept, 1, 2008 and the time the Stimulus bill gets signed, you will get an additional 60 days to sign up and receive the subsidy. You must have made an income of $125,000 or less ($250,000 for couples filing jointly). Cost: $24.7 billion.

Another provision provides states funding to help pay for expanded Medicaid rolls for workers who've lost their jobs and can't afford health care on their own or can't get Cobra coverage because their former employer doesn't offer a health care plan. Cost: $87 billion.

Unemployment benefits: Receive an extra 20 weeks in unemployment benefits, and an additional 13 weeks on top of that if you live in a state that is deemed to have a high unemployment rate, giving you extra time to find work. Cost: $27 billion.

The weekly benefit would increase by a minimum of $25. Cost $8.8 billion.

The first $2,400 in benefits in 2009 would be exempt from federal income taxes. Cost: 4.7 billion.

Food Stamp payments: Food stamps would be increased by 13.6%, so if you receive $588 per month at the present time, your payment would now be increased by $80.  Cost: $19.9 billion.

Other help for needy families: A contingency fund through 2010 will be created for the welfare program called Temporary Assistance for Needy Families, which provides cash assistance to the needy. Cost: 2.4 billion.


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