You: This economic stimulus – what’s in it for me?
There’s something for everyone (almost) in the economic stimulus package. But it probably isn’t much.
You: Well, what is it?
Starting in several weeks, you’ll get about 13 extra bucks in your weekly paycheck (probably.)
You: Just thirteen bucks? Didn’t the stimulus cost nearly a trillion dollars?
Yes and yes.
You: Okay then. Thirteen bucks. For how long?
For the rest of the year.
You: Then what happens?
Your stimulus gets reduced to nine dollars a week.
You: Is this a joke?
Define “joke.”
You: Something meant to evoke laughter through humor.
Intentionally evoke laughter or unintentionally cause laughter?
You: Intentionally evoke.
Then no.
You: Jeez. What else will I get from the stimulus?
That depends.
You: On what? On how I spend my $13?
No. It depends on whether you’re unemployed, needing health insurance as a result, looking to buy a home, or other specific conditions. Here are the highlights of what you may receive.
You: In addition to my thirteen bucks.
Right.
Unemployment Benefits
The first $2,400 of unemployment benefits you receive during 2009 will not be taxable.
You: What if I’m not unemployed?
Then this is not relevant to you.
Health Insurance
If you lose your job between Sept 1, 2008 and December 31, 2009 and want to keep your health insurance, you can select COBRA and the government will chip in 65% of the cost. You pay the remaining 35%.
You: What if my insurance is really expensive and I don’t lose my job?
Then this doesn’t apply to you.
You: What if I hate my job and quit?
No dice.
You: What it I currently have to pay more than 35% of the premium as an employee?
Then try to appreciate the irony.
People on Social Security or Who are Disabled
Many of those collecting Social Security or who are disabled will receive a one-time $250 check.
You: I suppose if I’m not disabled or on Social Security,
Correct. Nothing.
Car Buyer Tax Deduction
If you buy a new car before the end of this year, you can deduct the sales taxes you pay on the new car purchase even if you take the standard deduction.
You: What if I’m more practical and buy a slightly used car?
No tax-break.
You: What if my state has no sales tax?
No tax-break.
You: What if I buy a bicycle instead?
You’ll get better exercise but still no tax break.
First Time Home Buyer Tax Credit
The existing first time home buyer tax credit has been overhauled. The 2009 version of the first time home buyer tax credit was the subject of a recent post.
You: What if I already own my home?
Tell a friend.
You: That I bought a house too soon to qualify for the credit?
No. That your friend could still take advantage of the creidt.
You: Why would I want to do that?
Because you’re trying to be a nice person.
Miscellaneous
There are also some education-related spending and tax breaks for transit accounts.
You: I graduated school a fair bit ago. What’s the deal with the transit accounts?
You can spend up to $230 a month pre-tax for public transportation you take to work.
You: But I drive to work and my spouse works from home.
Then you get nothing.
You: Except the $13.
True.
You: Michael, you know, this conversation wasn’t very, how should I say . .. .
Stimulating?
You: That’s the word.
Tags: economic stimulus
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Dude that was awesome. Is 13 bucks really going to help others? With the cost of living jumping 5.4% and with thousands of people, who still have a job, will not receive a raise. I question where this will go. I know the govt. is basically giving us another $600 check but over a 1 year in time. How much benefit is it going to give people? From the sounds of it, I am one of the few that took that 600 bucks the first time and actually spent it on a vacation. But this time around, I more hesitent on stuffing it under the matress.
@Colby: Time will tell but I’m as skeptical as you appear to be. Let’s hope we’re wrong.
13 bucks a week times 52 weeks is 676 bucks; I can do something with that… that’s a month of rent for someone about to be evicted…
We get a government retirement check and that was about 30.00 a month on top of it time 12 months 360 bucks. Combined with the 676 we were SUPPOSED to get (we were told we’re not getting it by my husband’s company as he doesn’t qualify… but he does!), that’s 1036.00 Doesn’t seem like chump change when you look at it from that point of view. If I put that into a savings account, I could have a few more dollars. and in 10 years, it’d be doubled possibly.
If you are poor or middle class, ever dollar does help. 13 bucks is a tank of gas a week for a non gas hog car driven moderately. 13 bucks is that extra pack of diapers you need when you run out at pay day.
If everyone took that 13.00 a week and gave it to one foodbank in their community, my guess is they would be able to feed all the hungry. If everyone saved their money and donated in lump sums, my guess is they could spare millions who just needed that one more month to catch up on their mortgages.
For me, i am not poor. However, my family is and still 676 dollars is covering most of the tax on that new car Obama wants me to buy. That money plus the other incentives from the dealer me to me I CAN afford finally to get a new car!
It’s all how you look at it.
If I receive more in my pay check does this mean I will not get back as big of a income tax refund I do not want to owe a tax on 4/15
@Janice: Yes and no. Theoretically, the reduced withholdings will have no impact to the amount you owe (or have refunded) next year because your overall tax liability will be reduced by the same amount. That said, if you were to manually override (by refiling Form W4) your withholdings, you could always increase or decrease your eventual refund by increasing or decreasing your withholdings. Most people should do nothing at this time as the dollars involved aren’t big enough.