On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 - also known as the federal Stimulus Bill. The legislation offers numerous tax breaks and outlines spending plans that directly impact economic development and infrastructure development. Below are highlights from the Act; to view the entire text, go here.
Highlights of the $787 billion stimulus plan
AID TO POOR AND UNEMPLOYED
$40 billion to provide extended unemployment benefits through Dec. 31, as well as increase them by $25 a week; $20 billion to increase food stamp benefits by 14 percent; $4 billion for job training; and $3 billion in temporary welfare payments.
DIRECT CASH PAYMENTS
$14.2 billion to give one-time $250 payments to Social Security recipients, poor people on Supplemental Security Income, and veterans receiving disability and pensions.
INFRASTRUCTURE
$48 billion for transportation projects, including $27.5 billion for highway and bridge construction and repair; $8.4 billion for mass transit; $8 billion for construction of high-speed railways and $1.3 billion for Amtrak; $4.6 billion for the Army Corps of Engineers; $4 billion for public housing improvements; $6 billion for clean and drinking water projects; $7.2 billion to bring broadband Internet service to underserved areas; and $4.2 billion to repair and modernize Defense Department facilities.
HEALTH CARE
$24.7 billion to provide a 65 percent subsidy of health care insurance premiums for the unemployed under the COBRA program; $86.6 billion to help states with Medicaid; $19 billion to modernize health information technology systems; $10 billion for health research and construction of the National Institutes of Health facilities; and $1 billion for prevention and wellness programs.
STATE BLOCK GRANTS
$8.8 billion in aid to states to defray budget cuts.
ENERGY
About $50 billion for energy programs, focused primarily on efficiency and renewable energy, including $5 billion to weatherize modest-income homes; $6.4 billion to clean up nuclear weapons production sites; $11 billion toward a so-called "smart electricity grid" to reduce waste; $6 billion to subsidize loans for renewable energy projects; $6.3 billion in state energy efficiency and clean energy grants; $4.5 billion to make federal buildings more energy efficient; and $2 billion in grants for advanced batteries for electric vehicles.
EDUCATION
$44.5 billion in aid to local school districts to prevent layoffs and cutbacks, with flexibility to use the funds for school modernization and repair; $25.2 billion to school districts to fund special education as well as the No Child Left Behind Act law for students in K-12; $15.6 billion to boost the maximum Pell Grant by $500 to $5,350; and $2 billion for Head Start.
HOUSING
$4 billion to repair and make more energy efficient public housing projects; $2 billion for the redevelopment of foreclosed and abandoned homes; $1.5 billion for homeless shelters; and $2 billion to pay off a looming shortfall in public housing accounts.
SCIENCE
$3 billion for the National Science Foundation for basic science and engineering research; $1 billion for NASA; and $1.6 billion for research in areas such as climate science, biofuels, high-energy physics and nuclear physics.
HOMELAND SECURITY
$2.8 billion for homeland security programs, including $1 billion for airport screening equipment.
LAW ENFORCEMENT
$4 billion in grants to state and local law enforcement to hire officers and purchase equipment.
NEW TAX CREDIT
About $116 billion for a $400 per-worker, $800 per-couple tax credit in 2009 and 2010. For the last half of 2009, workers could expect to see about $13 a week less withheld from their paychecks starting around June. Millions of Americans who don't make enough money to pay federal income taxes could file returns next year and receive checks. Individuals making more than $75,000 and couples making more than $150,000 would receive reduced amounts.
ALTERNATIVE MINIMUM TAX
About $70 billion to spare about 24 million taxpayers from being hit with the alternative minimum tax in 2009. The change would save a family of four an average of $2,300. The tax was designed to make sure wealthy taxpayers can't use credits and deductions to avoid paying any taxes. But it was never indexed to inflation, so families making as little as $45,000 could get significant increases without this change. Congress addresses the alternative minimum tax each year, usually in the fall.
EXPANDED COLLEGE CREDIT
About $14 billion to provide a $2,500 expanded tax credit for college tuition and related expenses for 2009 and 2010. The credit is phased out for couples making more than $160,000.
CHILD TAX CREDIT
About $15 billion to provide the $1,000 child tax credit to more families that don't make enough money to pay income taxes.
EARNED INCOME TAX CREDIT
$4.7 billion to expand the Earned Income Tax Credit for low-income families with three or more children.
HOMEBUYER CREDIT
$6.6 billion to repeal a requirement that an $8,000 first-time home buyer tax credit be paid back over time for homes purchased from Jan. 1 to Nov. 30, unless the home is sold within three years.
AUTO SALES
$1.7 billion to make sales taxes paid on new cars, light trucks, recreational vehicles and motorcycles tax deductible through the end of the year.
RENEWABLE ENERGY INCENTIVES
About $20 billion in tax incentives for renewable energy and energy efficiency over 10 years, including extending tax credits for energy produced from wind, geothermal, hydropower and landfill gas; grants to build renewable energy facilities; tax credits for the purchase of energy-efficient furnaces, windows, doors, or insulation; as well as a tax credit for families that purchase plug-in hybrid vehicles.
BONUS DEPRECIATION
$5 billion to extend a provision allowing businesses buying equipment such as computers to speed up its depreciation through 2009.
REPEAL BANK CREDIT
Repeals a Treasury provision that allowed firms to buy money-losing banks so that they could use use more of the losses as tax credits to offset the profits of the merged banks for tax purposes. The change would increase taxes on the merged banks by $7 billion over 10 years.
DEBT LIMIT INCREASE
Increases the statutory limit on the national debt by $789 billion, to $12.1 trillion.
(Source: The Associated Press)