The Stimulus Package: What's in It for You

After weeks of CONGRESSIONAL in-fighting about "pork," partisanship and political agendas, President Obama signed the economic stimulus into law on Tuesday.

The plan's grand tally: $787 billion.

The Stimulus Package: What's in It for You?

A large chunk of those dollars will be spent on tax breaks -- both for business and consumers -- as well as infrastructure projects designed to help create (or save) jobs. But the plan comes with its fair share of compromises. Its overall size, for instance, has shrunk by tens of billions of dollars from Obama's original proposal, which was reported to top $900 billion. Obama's lofty goal to create or save up to four million jobs has now been ratcheted back to 3.5 million. His "Making Work Pay" payroll tax cut, which initially promised workers a $500 break, now promises just $400.

It s clear some aspects of this stimulus plan aren t as generous to individuals as previous versions, but it does include some direct benefits to consumers in real estate, health care and other areas.

Here s a breakdown:

Tax Credits: Will $13 a Week Stimulate You to Spend?

What the plan promises: A payroll tax credit that will provide up to $400 per worker ($800 per couple filing jointly). The credit, which will add about $13 a week to most people's paychecks, will start showing up sometime around June, says Dean Baker, co-director for the Center for Economic and Policy Research. (The credit will phase out completely at $200,000 for couples filing jointly and $100,000 for single filers). In 2010, consumers will receive an extra $7.70 per week, assuming the credit is spread over the entire year.

What you could have received: In President Obama s original proposal, the credit offered $500 for individual workers and $1,000 for couples filing jointly.

Final verdict: $13 a week it doesn t seem like much of an incentive to start spending again.

Job Creation: Great, if You're a Cop or Construction Worker

What the plan promises: To create or save a total of 3.5 million jobs through a combination of tax cuts for businesses, infrastructure spending and direct state aid. Each state will receive funding for major projects, including highway and bridge construction, mass transit expansion and improvements to public housing and water-treatment facilities. Nearly $40 billion is earmarked for local school districts to fund renovations and avoid teacher layoffs and another $4.7 billion will go toward programs to hire police officers.

What you could have received: President Obama initially promised a stimulus plan that would create or save four million jobs, but revised that figure before Congress voted on the plan.

Final verdict: While some industries and regions are poised for a quick rebound, most aren t. The Congressional Budget Office projects that many of these new jobs won t materialize until 2014. And many are just temporary or seasonal fixes, says Richard Ebeling, a senior research fellow with think tank American Institute for Economic Research.

First-Time Home Buyer Credit: Will Renters Really Leap?

What the plan promises: Prior to the plan's passage, first-time home buyers who bought a house between April 9, 2008, and June 30, 2009, received a tax credit of either up to 10% of the home's price, or $7,500. The hitch: The credit had to be paid back over 15 years. Now, as part of the stimulus, home buyers receive $8,000 that they don't have to pay back -- and the credit is extended to those who buy a home through the end of November. The credit phases out for single filers who make more than $75,000 annually ($150,000 for couples filing jointly).

The biggest drawback: First-time buyers who used the credit in 2008 still have to pay it back over a 15-year period.

What you could have received: This credit replaces the $15,000 tax credit to buy a new home for all buyers that was originally in the Senate version of the stimulus.

Final verdict: Sure, a generous reprieve on paying back the credit may spark some people to buy a home. However, a poll of our readers recently found that it will take a lot more than a credit to prompt them to buy in this market.

Unemployment Benefits: An Extra $25 a Week and a Tax Reprieve

What the plan promises: Americans who are currently unemployed can claim up to 33 weeks of benefits through December (the program was originally scheduled to phase out in March). Benefits will increase by $25 per week for some 20 million jobless workers, while the first $2,400 they receive in benefits will be exempt from federal taxes. Laid-off workers buying into their former employer s health insurance through the COBRA program will receive a 65% subsidy on premiums for up to nine months. On the job-hunt front, the stimulus plan includes $4 billion in adult and youth job training and $500 million for state employment agencies to help the unemployed find job openings.

What you could have received: The House had suggested a subsidy on COBRA premiums for up to a year.

Final verdict: If you re among the 7.6% of Americans who are currently unemployed, this extra aid will make it a little easier for you to make ends meet while you work toward getting back into the work force.

New Car Buyer Tax Perks: Probably Won't Clear the Lots

What the plan promises: Those who buy a new car between now and December 31 can deduct state and local sales and excise taxes. The purchase price limitation cap is $49,500. So if you paid $65,000 for a new car, the deduction only applies toward no more than $49,500. Taxpayers with an adjusted gross income of $135,000 or more don t qualify for the deduction; those with AGI between $125,000 and $135,000 get a partial deduction ($250,000 and $260,000 if filing jointly).

What you could have received: The plan's $2.5 billion toward the car-buying tax breaks is a far cry from the Senate's plan, which sought $11.5 billion in tax breaks and a deduction for interest paid on car loans.

Final verdict: As far as a stimulus goes, it will have very minor impact. In this case, people who can afford to buy a new car will be better off than lower-income people, says James Horney, director of federal fiscal policy at think tank Center on Budget and Policy Priorities.

Funding Boost for Health Care/Medicaid: Won t Keep Everyone Healthy

What the plan promises: In addition to the 65% subsidy aimed at helping unemployed workers afford COBRA coverage (see unemployment benefits slide), states will also get $87 billion over the next two years to help them maintain existing Medicaid programs in the face of severe budget shortfalls.

What you could have received: The House version of the bill would have also allowed states to temporarily cover unemployed workers (of a certain income level) and their families under Medicaid. That plan would have covered people caught in the health-insurance gap unable to afford COBRA premiums and ineligible for Medicaid.

Final verdict: The Medicaid boost might not be enough to make a sufficient dent in states deficits, which are projected to reach $350 billion over the next two years, according to the Center on Budget and Policy Priorities.

Education: Uncle Sam Cuts College Kids Some Slack

What the plan promises: Replaces the Hope Scholarship Credit, which offered a maximum tax credit of $1,800 toward college tuition and expenses, with the American Opportunity Education tax credit, which offers a maximum of $2,500 toward college tuition and related expenses for 2009 and 2010. While the Hope Credit only applied to tuition paid for the first two years of post-secondary education, this law makes it applicable to the first four years -- and makes it partially refundable.

The plan also boosts the maximum Pell Grant by $500, for a maximum of $5,350 in 2009 and $5,550 in 2010. (The federal Pell program provides grants to low-income undergraduate students and some post-graduate students.)

What you could have received: The Senate version of the plan would have only boosted the maximum Pell Grant by $400.

Final verdict: Anything to help offset the rising cost of college tuition is a step in the right direction.

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