Planning for Obamas Tax changes

Tax Credits Raise Hopes For A New Life For Many Americans

The temporary tax relief offered by President Obama’s stimulus package has raised hope for many Americans. College students and their parents are especially thrilled by the thought of qualifying for up to $2,500 for tuition and other related expenses during 2009 and 2010.

This additional aid to thousands of lower and middle class families are expected to start around June, and will spread out through 2009.Students who plan on starting college this Fall are overjoyed by the news, which indicates they can have a great head start to achieving their dreams. This is one of the new President’s major priorities, that all children have an opportunity to have a college education. Parents can expect to see less tax taken from their paychecks, once the plan gets going. This year, they can also expect to see an extra $13.00 a week in their paychecks and about $7.70 a week in 2010. This makes a total increase of about $20.00 more in individual paychecks.

Individuals making less than $75,000 a year and couples making less than $150,000 a year are the ones expected to benefit when June comes around. Individuals making more than $75,000, and couples making more than $150,000 would receive reduced cuts. For those families making more than $150,000 a year, the time period is expected to be phased out. Millions of Americans will receive larger unemployment checks.

For the country, the goal of this two year temporary relief is to help the ailing economy to get back on its feet. Bigger paychecks mean greater spending power for shopping; and new jobs are expected to be created. In addition to having a bit more freedom for spending, individuals and families will have a brief opportunity to get a fresh start in their lives. Millions will continue to have health care coverage, giving renewed hope for life, leading to a healthier nation. The millions who have been living paycheck to paycheck would now be able to pay their bills with a little more ease.

Home-owners and buyers will benefit greatly. By expansion of the home improvement tax credit, energy efficient home improvements will now be 30% of the cost of improvement up to a maximum of $1500. This will be reflective in a tax refund when you file your returns. So, now is the opportune time to make necessary home improvements. First time home buyers will have an increase of $500; from $7,500 to $8,000 for homes purchased between January 1st 2009 and December 2009. The good news here is that is that the credit no longer needs to be paid back as was done previously (over a 15 year time frame). The only condition is that the buyer lives in the home without selling it for a minimum of three years.

All in all, the plan aims at eliminating poverty to a great extent and allowing millions of hard-working low-income families to have an opportunity to live a middle class life. Everyone gets a chance here. The wise thing for everyone to do is to seize the bull by its horns and make the best of creating a new future, not only for ourselves, but in helping America to remain on the road as a leading world nation.