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Rangel Releases Details of Tax Portion of Obama Stimulus Plan

Rep. Charles B. Rangel (D-N.Y.), chairman of the Ways and Means committee, just released the details of President-elect Obama's $275 billion tax portion of the $800-some billion stimulus plan, The Post's Lori Montgomery reports.

The bill authorizing the stimulus will be introduced in coming days, Rangel's office says.

In the interest of speed, The Ticker is posting the entire text of Rangel's release here and we'll come back later and highlight notable sections.

The thing is a classic congressional Christmas tree, but a couple of items pop out:

- Unemployment checks would increase by $25 per week.
- Businesses can depreciate bonuses.
- It would provide for bonds for school building.
- Provide a one-time additional SSI payment to low-income elderly and disabled recipients.
- Provides temporary subsidies for health insurance coverage to those who have lost their jobs.
- Extends the availability of unsubsidized COBRA coverage for older and tenured workers beyond the 18 months provided under current law.

-- Tax Relief for Individuals:
- "Making Work Pay Credit"
- Expand Earned Income Tax Credit (EITC)
- Increase in child tax credit, $0 floor
- Education
- Simplification of education credits w/ $2,500 credit for first four years of higher education expenses (increase income limitations), with credit partially-refundable (40% refundable)

-- Housing:
- Remove repayment requirement on $7,500 first-time home buyer credit for homes purchased after 2008 and before termination of credit (June 30, 2009).
-Coordination provisions with new grant program for low-income housing being designed by the Financial Services Committee.

-- Business:
- Bonus depreciation.
- 5-year carryback of net operating losses (excluding companies receiving TARP benefits, Fannie Mae, Freddie Mac).
- Extension of increased small business expensing.
- Expand work opportunity tax credit for disconnected youth and unemployed, recently-discharged veterans.
- Prospectively repeal Treasury Section 382 ruling.


-- State and Local Governments:
- Allow financial institutions to purchase State and local bonds and other changes.
- Repeal AMT limits on new private activity bonds.
- Taxable bond option for governmental bonds.
- School construction bonds.
- One year deferral of withholding tax on government contractors.

-- Distressed Areas:
- Provide tax exempt bonds and tax credit bonds to "recovery zones." These tax exempt bonds and tax credit bonds can be used for a wide array of purposes to stimulate economic development, including job training and education. A "recovery zone" would be an area within a
state, city or county that has exhibited high unemployment, foreclosures or poverty. These bonds would be allocated automatically to states and large municipal governments based on the number of unemployed individuals within that area.

-- Energy Tax Incentives
- Long-term extension of renewable energy production tax credit.
- Temporary election to claim the investment tax credit in lieu of the production tax credit.
- Coordination provisions with new grant program for renewable energy projects being designed by the Energy and Commerce Committee (sections 45 and 48 projects).
- Clean Renewable Energy Bonds ("CREBs").
- Qualified Energy Conservation Bonds.
- Energy efficiency and conservation tax incentives under sections 25C, 25D and 48.
- Smart energy conservation, energy efficiency, and renewable energy R&D credit.
- Refueling property credit expansions.

--Trade Adjustment Assistance (TAA):
- Updates, modernizes and expands TAA to cover service workers, and substantially improves and extends coverage to manufacturing workers.
- Triples funds for job training.

-- Unemployment Insurance (UI):
- Encourage UI Modernization.
- Continue the Emergency Unemployment Compensation Program.
- Increase UI checks by $25 per week.

-- Additional Temporary Assistance for Needy Families (TANF):
- Provide additional TANF contingency funds to serve needy families.

-- Supplemental Security Income (SSI):
- Provide a one-time additional SSI payment to low-income elderly and disabled recipients.

-- Child Support Enforcement Funding:
- Restore federal funding for Child Support Enforcement for two years.

-- COBRA Healthcare for the unemployed:

- Provides temporary subsidies for health insurance coverage to those who have lost their jobs.
- Extends the availability of unsubsidized COBRA coverage for older and tenured workers beyond the 18 months provided under current law.

-- Health Information Technology (HIT):

- Establishes standards, payment incentives and privacy protections to encourage the widespread adoption of health information technology.
- Extends Moratorium on Selected Medicare Regulations through October 1, 2009.

-- Frank Ahrens
The Ticker is Twittering!

By Frank Ahrens  |  January 15, 2009; 11:23 AM ET
Categories:  The Ticker  | Tags: Obama, stimulus plan  
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Comments

Anyone know what happened to the campaign proposal to exempt unemployment compensation from federal income tax for a couple of years? Can it still be enacted to apply to 2008 returns?

Posted by: NearingRetirement | January 15, 2009 12:44 PM | Report abuse

Where is the tax cit for Senior's???

President Obama's Promised Tax Cuts:

WHO: 70-year-old widow making $35,000

TAX CUT $1,900
[reflects elimination of income taxes for seniors earning under $50,000]

http://change.gov/agenda/taxes_agenda/

Posted by: buzzm1 | January 15, 2009 1:12 PM | Report abuse

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