ECONOMIC STIMULUS PASSES CONGRESS & SIGNED INTO LAW<\/p>\n
17 February 2009<\/p>\n
How the Economic Stimulus Plan Affects Individuals with Disabilities<\/p>\n
The $789 billion U.S. economic stimulus package, which was signed
\ninto law February 17th by President Barack Obama, contains numerous
\ntax provisions including $282 billion in tax cuts. Several of the
\nmajor tax provisions incorporated in the final bill include:<\/p>\n
* MAKING WORK PAY TAX CREDIT: Creates a “Making Work Pay” tax credit
\nof $400 or 6.2% of earned income (whichever is less) per individual
\nand $800 for a couple in 2009 and 2010. It is phased out for
\nindividuals with adjusted incomes over $75,000 and couples with
\nincomes over $150,000. This credit is not included in income for
\npurposes of any federal means-tested benefit program. It is included
\nin resources but only after two months. The best and quickest way to
\nbenefit from this credit is to make sure that your employer decreases
\nyour withholding to reflect it.<\/p>\n
* ONE-TIME PAYMENT FOR SS BENEFICIARIES, VETERANS & RR RETIREES:
\nProvides a one-time payment of $250 to Social Security beneficiaries,
\nrailroad retirees and veterans receiving benefits from the Veterans
\nAffairs department. This is in addition to the Making Work Pay Tax
\nCredit, and there is no tax return filing requirement to access this
\nbenefit. Beneficiaries will receive an electronic payment within 120
\ndays of the Secretary of Treasury initiating the benefit. Payment will
\nNOT count as a resource or income for SSI beneficiaries, thus making
\nall beneficiaries eligible for the one-time payment.<\/p>\n
* STATE GOVERNMENT RETIREES ALSO ELIGIBLE FOR ONE-TIME PAYMENT: State
\ngovernment retirees not eligible for Social Security would also get
\nthe $250 payment. Also, Sec. 2202 provides for a $250 tax credit
\n(refundable) to those federal and state retirees who worked at a time
\nwhen their wages were not subject to Social Security payroll tax. They
\nwill have to file a return and this credit will reduce the amount they
\nmay qualify for under the Making Work Pay Credit, if the filers are
\nstill working. This group did not qualify for ESP payments last year
\nbased on their retirement pensions, which were not considered
\nqualifying income(although they could have qualified based on income
\ntax liability or other qualifying income).<\/p>\n
* EARNED INCOME TAX CREDIT INCREASE: Increases the earned income tax
\ncredit for low-income workers with three or more children.<\/p>\n
* EXPANSION OF CHILD TAX CREDIT: Expands eligibility for the $1000
\nrefundable child tax credit to more low-income workers families that
\ndon\u2019t make enough money to pay income taxes, reducing the income
\nfloor to $3,000 in 2009 and 2010 from the current floor of $8,500.<\/p>\n
* EDUCATIONAL EXPENSES: Provides a new $2,500 tax credit for college
\neducation expenses. The credit phases out for individuals earning more
\nthan $80,000 and couples with incomes over $160,000.<\/p>\n
* FIRST-TIME HOMEBUYERS: Provides an $8,000 tax credit for first-time
\nhome buyers for homes purchased between Jan. 1 and Dec. 1, 2009. The
\ntax credit phases out for individuals earning more than $75,000 and
\ncouples earning more than $150,000.<\/p>\n
* ALTERNATIVE MINIMUM TAX: Provides temporary relief from the
\nalternative minimum tax for millions of middle-class taxpayers.<\/p>\n
* FOR BUSINESSES<\/p>\n
o Allows small businesses with gross receipts of up to $15 million to
\nwrite off 2008 losses against five previous tax years. Current law
\nallows a two-year carry-back of losses.<\/p>\n
o Businesses will also be allowed to immediately write off more of
\ntheir investments in computers and other equipment.<\/p>\n
o Gives a tax break on capital gains from the sale of stock held in a
\nsmall business for more than five years.<\/p>\n
* FOR STATE AND LOCAL GOVERNMENTS<\/p>\n
o Creates a new category of tax-preferred bonds for investment in
\neconomic recovery zones for job training, education and economic
\ndevelopment.<\/p>\n
o Creates a new category of tax-preferred bonds for the construction,
\nand repair of public schools and the purchase of land for schools.<\/p>\n
o Creates a federal subsidy for state and local governments offering
\nbonds that give investors credits against their federal taxes in place
\nof interest payments.<\/p>\n
Additionally, the stimulus package included several additional forms
\nof assistance beyond tax relief, including the following
\nprovisions:<\/p>\n
* AGING SERVICES TECHNOLOGY STUDY & REPORT<\/p>\n
o Provides funding to the Secretary of Health & Human Services to
\nsupport a study of the use of innovative technologies to assist the
\nelderly, individuals with disabilities and their caregivers throughout
\nthe aging process.<\/p>\n
* DIGITAL-TO-ANALOG CONVERTER BOX PROGRAM<\/p>\n
o Specifies that $90 million of the $650 million must be used for
\neducation and outreach, including grants to organizations for programs
\nto educate vulnerable populations, including senior citizens, minority
\ncommunities, people with disabilities, low-income individuals, and
\npeople living in rural areas. The funds can also be used to provide
\none-on-one assistance for installing the digital-to-analog converter
\nboxes for these populations.<\/p>\n
* EDUCATION EMERGENCY REPAIR & INFRASTRUCTURE GRANTS<\/p>\n
o Criterion includes consideration of whether or not current
\ninfrastructure is inaccessible to people with disabilities.<\/p>\n
* HEALTH INSURANCE:<\/p>\n
o For individuals who have lost their jobs from 1 September 2008 thru
\nthe end of 2009 and qualify to extend their health insurance benefits
\nunder COBRA, the government will cover 65% of the total cost of the
\nemployer premium for the first 9 months. Those who didn\u2019t elect
\nCOBRA coverage at the time will have 60 days to enroll should they
\nchoose. However, COBRA is not available for people whose companies go
\nout of business or drop the insurance.<\/p>\n
o $87 billion to support state Medicaid programs.<\/p>\n
* HUD PROVISIONS<\/p>\n
o Gives the Secretary of Housing & Urban Development broad authority
\nto waive legal requirements in the administration of housing programs
\nunder the Act, but prohibits the Secretary from waiving requirements
\nrelated to fair housing, non-discrimination, labor standards, and the
\nenvironment.<\/p>\n
o Ensures that recipients of HUD assistance via the economic stimulus
\npackage must honor Section 8 leases and cannot refuse to rent to
\nSection 8 subpopulations.<\/p>\n
* INFRASTRUCTURE DEVELOPMENT GRANTS<\/p>\n
o All grantees must ensure that all infrastructure building projects
\nare in compliance with Section 504 of Title 4 of the Workforce
\nInvestment Act of 1998.<\/p>\n
* SMALL BUSINESSES:<\/p>\n
o Clarifies definition of \u201cindividuals with disabilities and
\nbusiness owned by individuals with disabilities\u201d within Small
\nBusiness Act to confirm the rights of disabled business owners to
\nbenefit from the tax credits afforded to small businesses (see above).<\/p>\n
* SPECIAL EDUCATION:<\/p>\n
o $12.2 billion, of which<\/p>\n
+ $11.3 billion reserved for Section 611 of the IDEA<\/p>\n
+ $400 million reserved for Section 619 of the IDEA<\/p>\n
+ $500 million reserved for Part C of the IDEA<\/p>\n
* UNEMPLOYMENT ASSISTANCE:<\/p>\n
o Individuals shall not be disqualified from regular unemployment
\ncompensation for separating from employment if that separation is for
\nany compelling family reason, including the illness or disability of a
\nmember of the individual\u2019s immediate family (as defined by the
\nSecretary of Labor)<\/p>\n
o Those receiving unemployment benefits this year will not have to
\npay federal income taxes on the first $2400 they receive.<\/p>\n
* VOCATIONAL REHABILITATION<\/p>\n
o $680 million<\/p>\n
+ $540 million for part B of Title I of the Rehabilitation Act<\/p>\n
+ $140 million for parts Band C of Chapter 1 & 2 of Title VII of the
\nRehab act<\/p>\n
# $18.2 for state grants<\/p>\n
# $87.5 for independent living centers<\/p>\n
# $34.3 for services for older blind individuals<\/p>\n
In addition to reviewing the actual text from Division A & B of
\nH.R. 1, The American Recovery & Reinvestment Act, recent information
\non tax provisions included in the legislation was further verified
\nusing the following sources: Reuters (13 February 2009); U.S. House of
\nRepresentatives Appropriations Committee Executive Summary & Detailed
\nSummaries (www.house.gov\/appropriations); and the Joint Statement on
\nDivision B, U.S. House of Representatives Rules Committee
\n(www.house.gov\/rules).<\/p>\n
All programmatic assistance sections were verified upon review
\nof the 12 February text of H.R. 1, The American Recovery &
\nReinvestment Act.<\/p>\n