How the Stimulus Helps You
Your finances could benefit from breaks on home and car purchases, college aid, and taxes.
From Kiplinger's Personal Finance magazine, May 2009
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The economic-stimulus plan President Obama signed isn't going to feel like a windfall to most Americans. For those who collect a paycheck, the $45 extra per month will be more like a pleasant surprise. But it's still smart to know the timing and amount of tax breaks and other benefits.
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For example, if you're considering buying a car or your first house, making your purchase sooner rather than later could save you thousands of dollars. If you're one of the 26 million additional taxpayers who will be able to dodge the onerous alternative minimum tax for 2009, your tax savings could help you tweak your budget. And if you're struggling to finance a child's college education, you can count on more money for grants and jobs—if you qualify.
Here's another boon: The stimulus provides a one-time payment of $250 to recipients of Social Security, Railroad Retirement and veterans' benefits, which should start to arrive in May. You'll receive the money electronically or via check. Federal-government retirees who don't get Social Security should receive a $250 credit when they file their 2009 tax returns.
Guide to the Stimulus
The New Stimulus Tax Credit
This tax break puts up to $400 in your pocket.
New Car Sales-Tax Deduction
Car buyers have till the end of the year to grab this above-the-line deduction.
Better Benefits for the Unemployed
Qualified filers get an extra $25 a week.
New Homebuyer Credit
Take up to 10% off your purchase price.
Health-Care Subsidy for the Unemployed
Now there's extra help for paying COBRA coverage.
AMT Tax Relief
Taxpayers get a one-year fix on the alternative minimum tax.
College Aid Gets Fresh Funding
Rather than introduce big new ideas, this bill mostly replenishes underfunded programs and increases amounts available to families.
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Reader Comments (16)
Posted by: Charles Moshier at 04/08/2009 09:44:18 AM
I really wonder how much inflation it will create? You know that 250 (that) recipents receive could well be eliminated. As a matter of fact it could have a negative effect and decrease the value of the dollar.
Posted by: Keith W at 04/08/2009 11:29:31 AM
And how does it hurt us? nd is the cost worth the benefit? expect more from Kiplingers.
Posted by: Marie W at 04/08/2009 10:02:52 PM
"If you qualify" seems to be the operative words these days. I am a 56 year-old single person with a very high credit rating who has always paid her bills on time. In 11/08, I lost my job in a company layoff. I have continued to pay all my bills and mortgage on time thanks to using up all of my hard-earned savings. Today I find out today my Fannie Mae mortgage is not eligible to be modified or refinanced because Fannie has "income guidelines" you must meet to qualify. And since I have no job hence no income (and they do not count unemployment as "income") I do not qualify. Plus the bank will not do a standard refinance because ... I have no job. If I had income/job, I wouldn't need the modification, now would I? Go figure. The bank rep apologized and said he was sorry but his hands are tied.
Posted by: david s hovda at 04/09/2009 01:36:51 PM
That 13 trillion dollar bailout to the big banks and aig gm chysler fammie may freedie mac and other crooks and theives ,that got us into this mess in the first place. With 10% unemplyed that is about 15 million families without any income! That 13 trillion dollars would amout to a check for 3.2 million dollars for each family!!! I think that would do much more good than a bail out for GM. P.S. they are going broke anyway!!so what is the use, it is unavoidable. %
Posted by: Joseph Bendzinski at 04/15/2009 01:01:56 AM
Boy - Another obama give-a-way. Just how much in taxes is this amount going to cost me? When the government gives you something it is not for free. Look out - All this hope and change is not working for me.
Posted by: Will in time of need at 04/26/2009 09:20:40 AM
I'm tired of hearing people complain about how much it is going to cost them in taxes to help out their fellow countrymen in need. Were the same people complaining as much about taxes when it was decided that we would spend billions on the unwarranted invasion and occupation of Iraq?
Posted by: dja at 04/30/2009 02:14:25 PM
Mr. Hovda: $13 trillion divided by 15 million families is $866,667. Still lots of dough, but not 3.2 mill.
Posted by: vinny at 04/30/2009 04:32:39 PM
What about the banks getting out of control with interest rates raising them almost 10% and from a lock on your fixed rates to a variable and raise when ever they want. The government better take over the banks NOW.
Posted by: Eareks at 04/30/2009 04:53:36 PM
"The economic-stimulus plan President Obama signed isn't going to feel like a windfall to most Americans. For those who collect a paycheck, the $45 extra per month will be more like a pleasant surprise." Maybe nice "surprise" for people living in India, not CITIZENS of the US!.Create the jobs!!!Not "pinch-a-penny AWARD Society Club"
Posted by: Denise at 04/30/2009 06:36:46 PM
I think the only way the "government by the people and for the people" will ever wake up and realize that the American people are tired of bailing out poorly run businesses that got rich of screwing the "people", is if every American smothers Washington in paper and phone calls, flood their local politicians offices with protests, and boycott paying taxes. If we don't pay our taxes then the government can't bail out the idiots! Take the trillions of dollars used to bail out corrupt companies, divide it up equally to every LEGAL American so they can pay off their bills, buy new cars, and fix the economy. Instead, the government sees fit to raise our taxes, cut benefits, cut funding to much needed programs for the poor, the elderly, the veterans, and needy children. Please, someone explain to me the reasoning behind sending money to foreign countries to help their countries while we have families and children going hungry here! This country is only as strong as its people and I believe that the people are falling apart from lack of competency at all levels of the government. Fire them all, put real people in to run the country!!!
Posted by: CJ at 04/30/2009 06:40:32 PM
We are STILL in Iraq, silly. Where's the motivation for that now... hidden, of course.
Posted by: kd at 04/30/2009 06:51:47 PM
They don't recognize unemployment as income but they sure tax it! Good luck with refinancing anything...all the money for the bailouts went in the pockets of the good-for-nothing CEOs and the politicians they have in their pockets!
Posted by: That Guy Gary at 04/30/2009 08:09:26 PM
In regard to the trillions printed up for bailouts, it is very true that it would have been better to direct funds to the victims, us, rather than the crooks and incompetents. The Politicians and Corporate money handlers simply worked together on this to keep the machine they are used to running go on, but when the day comes to pay the bill after they fail to meet the revival goals to retrieve all that paper, we are in deep *$#t...Actually we are there already and need to flush the Legislative as well as the Corporate entities. Too bad about the bail out fiascos. It would have been much better to let it all fall down naturally after the many mistakes made, so it could all rebound on it's own in our free market system. You'll still see the same post-Great Depression record Unemployment with these bail outs in place(and we don't get the actual UE rates as many thousands are out of the system at this point)-- we need to elect a new kind of Politician each time we get the chance: People who want to serve us and not themselves on the often corrupt money feedbag they are attached to after elected. You know the big names so I don't have to mention them, but after all this I am so certain it pervades most of the Representative body and the Corporate contacts that get them elected, we must find a way to CHANGE how things are done in Washington and in the Fortune 1000+ in this Country. Jefferson is either laughing or turning over in his grave. Hamilton is turning over in his grave, and Ben Franklin is wishing a whole lot of bad news bears who got a hold of his US of A had their hands on wet metal keys attached to long strings high above in lighting laden clouds. TG Gary
Posted by: Jeri Burns at 05/01/2009 08:05:53 AM
There are so many things to complain about that if people started counting they would have no time to do the actual complaining. Bottom line is...this is a bad time and the only way to make a change for the better is to buck up and do whatever you can do to help. So, "put your shoulder to the wheel and push along"! Complaining does nothing but add to "ear" pollution.
Posted by: Matty at 05/02/2009 11:22:24 AM
We all need to come together and have revolution, things are getting out of hand fast!!! We are slowly losing our freedom. If we don't do something soon, it will be too late, but it will take everyone for it to happen. Wake up and get with the program!!
Posted by: CRB at 05/16/2009 12:17:01 PM
Well let see, No job , no money , no home I guess I don't have to pay taxes...