Looks like Santa Claus came a bit early this year and with a bit of Congressional drama from both Houses, got Christmas going for millions of Americans. With this unemployment extensions and tax cuts bill finally passed, many Americans who have struggled in this economy will have a better Christmas.
The strong bipartisan vote on the tax cuts and unemployment extensions bill will keep in place what has been currently running and provide additional benefits to individuals and business alike. This unemployment extensions and tax bill should be signed by President Barack Obama by Friday afternoon.
For those who may not know about the major provisions in this historic tax cuts and unemployment extensions bill, here are some key facts:
- The estate and gift tax will provide for a $5 million credit amount or $10 million per couple at a 35% rate. This provision will continue for two years.
- The income tax cuts will remain for all Americans at the Bush era rates. Included are child credits, adoption credits, dependent care credits, education credits and the earned income tax credit.
- Capital gains and dividends will be kept in place at 15% for the next two years.
- Expensing rates will allow for a 1 year 100% depreciation.
- A payroll holiday where Social Security tax is cut from 6.2% to 4.2% for one year.
- Temporary extension of unemployment insurance for up to 13 months.
- Energy extenders with tax credits towards energy efficient purchases
- Tax credits to businesses with research and development projects.
There are many more provisions that can be listed here. However, by the end of the day the whole tax cuts and unemployment extensions bill will cost a little over $850 billion in cuts and spending. Therefore, let's hope this makes for a Merry Christmas and with fingers crossed, this will give the U.S. economy a strong push for the start of next year.
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