The 2009 stimulus package bill has been very controversial because nobody knows for sure how much stimulus is needed to get the economy back on track or what form the stimulus should take. A stimulus check 2009 giving cold, hard cash to the population would certainly be a popular choice but it looks like tax cuts and infrastructure spending will make up the bulk of the stimulus package. There will however be a $250 stimulus check in 2009 for selected groups.
Let’s take a look at what this bill contains and what was left out:
Tax cuts
This is the 2009 equivalent to the stimulus check of last year – Tax cuts in the order of $400 for individuals and $800 for couples. This is a bit less than the original stimulus tax cut proposals of $500 per individual and $1000 per couple. This isn’t as exciting as receiving a stimulus check in the mail but is basically the same thing since it means more cash in your pocket.
$8,000 tax credit for first-time home buyers
This tax credit was originally planned to be a $15,000 tax credit, however it has been reduced to $8,000 which is still a pretty good break. The tax credit is not a loan so it doesn’t need to be paid back.
This tax credit applies to any houses bought between January 1, 2009 and November 30, 2009. To qualify individuals must make less than $75,000 and couples must make less than $150,000.
Infrastructure spending
A good portion of the approximately $800 billion package will go to infrastructure projects such as schools, highways, energy and technology projects.
Tax break on AMT
$70 billion of this package will be going towards allowing millions of middle-class Americans from paying the dreaded AMT (alternative minimum tax) which was originally intended to prevent higher income Americans from avoiding the payment of any income tax but due to inflation creep – is now applicable to lower salaries.
Limits on Wall Street bonuses
This applies to financial companies that are accepting government bailout funds. The rule is that any bonuses for executives can’t be more than 1/3 of their regular salary. The other catch is that the bonuses have to be paid in company stock which doesn’t vest until the government bailout money is paid back.
I think this is a great idea – these executives are the ones who took too many risks in the first place so reducing their pay makes sense to me. One could argue of course that maybe those executives shouldn’t still be in charge but apparently that is the case.
This measure will only work in the short term since any new executive contracts will have much higher base salaries if the stimulus limits are applicable. Hopefully there won’t be a slew of “new contracts” for various executives with higher base pay.
$250 stimulus check for select groups
There will be a $250 stimulus check for select groups.