[Update August 2010] Sen. Debbie Stabenow (D-Mich.) introduced a bill – s3706, Americans Want to Work Act - in the Senate that would provide extra weeks of benefits to people who’ve reached the end of their unemployment insurance lifelines (Tier 5) in states with over 7.5% unemployment. The measure would provide 20 extra weeks of unemployment benefits and extend the existing HIRE tax credit for businesses that hire workers who’ve been unemployed for 60 days or longer.
“Across our state, more than 35,000 people who have lost their jobs have also exhausted their unemployment insurance benefits. I know that these men and women want to work and have been trying their best to find jobs in this difficult economy,” said Stabenow. “My legislation cuts taxes for businesses that hire new workers who have been looking for work the longest. My bill also provides 20 more weeks of unemployment insurance to people in states like ours with the highest number of people out of work.”
The Americans Want to Work Act extends through 2011 the successful HIRE Act tax credit which cuts payroll taxes for businesses that hire workers who have been out of work for longer than 60 days and also gives them a $1,000 general business tax credit for each worker employed for at least a year. The Stabenow bill also doubles the tax credit to $2,000 if businesses hire workers who have totally exhausted their unemployment benefits.
Recent reports from the Department of Treasury show that from February to June of this year, businesses hired approximately 5.6 million new workers who had been out of work for eight weeks or more. This bill will have to be approved in the Senate before going to the house for congressional approval (assuming no other changes). Past extensions have been tough to get approved amid complaints they would add too much to the deficit, which is likely to impede this bill as well.
I will continue to provide updates on the ongoing political debate and f further unemployment extension benefits, and encourage you to subscribe (free) via Email or RSS to get the latest news.
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[Update July 2010] The U.S. Congress and the President broke a Republican filibuster and approved legislation restoring unemployment benefits to 2.5 million Americans who lost aid during a political dispute over how to pay for it. Benefits will be extended for those who have already used their standard 26 weeks of unemployment. Republicans had stalled the $33.9 billion package (HR 4213) for weeks, arguing that aid should be paid by making cuts elsewhere. Democrats have maintained that jobless benefits are emergency spending that traditionally have not been offset.
The legislation would extend through November a program offering the long-term unemployed up to 99 weeks of assistance and provide aid retroactively to those whose checks were cut off by the impasse. It would push total unemployment benefit spending this year to more than $130 billion, a 50 percent increase from last year, according to the nonpartisan Congressional Budget Office.
Democrats dropped other unemployment assistance provisions amid complaints over the cost, including a 65 percent subsidy created last year to help the jobless buy health insurance through their former employers (COBRA). There is no plan to extend them during this session of Congress even though it benefited 2 million households last year, according to the Treasury Department. The measure wouldn’t renew an additional $25 weekly jobless benefit (Federal Additional Compensation Program) that was part of last year’s economic stimulus. That means that all retroactive payments would be for $25 less than what they were before June 2nd, as will all payments in new tiers. Nor would it extend a tax exemption for the first $2,400 in unemployment aid.
Also, Democrats don’t plan to extend aid to the growing number of Americans who have already received the maximum 99 weeks of allowable aid (Tier V or Tier 5 provision). 99 weeks (Tier IV) would still be the maximum amount of a time a person could receive benefits for in states with high unemployment rates, and 86 weeks (Tier III) would still be the max in states with low unemployment rates.
A number of other jobs-related provisions, including plans to send additional aid to state governments, that once comprised Democrats’ election-year agenda were jettisoned amid complaints they would add too much to the deficit
The unemployment benefits extension debate will be reread over and over again in the coming months as part of the talking points in the platforms of both Parties as they campaign toward the November elections. Republicans will accuse Democrats of wasteful spending tendencies, steering the country in the wrong direction, crushing the nation’s grandchildren with massive deficit spending. Democrats will accuse Republicans of a lack of vision, not willing to tax the rich but perfectly willing to deny the poor (and unemployed), and press the idea that it was 12 years of deregulation and profligate spending under a Republican-led Congress, plus the disastrous economic policies — continuous tax breaks — of the Bush administration, that led to the current economic situation.
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[Update Mar 2010] Congress and now the President have approved a $45 billion plan to expand a tax credit for first-time home buyers, extend jobless benefits and provide tax refunds to money-losing companies. The bill (H.R.3548) will be funded from the $787 billion stimulus originally approved in Feb 2009.
Unemployment Benefits Extension
The government is proposing to spend $2.4 billion to extend unemployment benefits for between 14 to 20 weeks, enough to cover the upcoming holiday season. States with the highest unemployment would get the highest unemployment benefits. The extension will benefit nearly 1 million out-of-work people who will run out of benefits by the end of the year. If HR3548 passes with the proposed amendments unemployed workers would generally get the following additional benefits:
- 14 weeks extra for everyone in any US state (up from the 13 initially proposed by the house in the unemployment compensation Extension act, S. 1699)
- An additional 6 weeks, for a total of 20 weeks, for those in states with unemployment at or over 8.5% (3 month average)
With enactment, the jobless in the hardest-hit states could receive up to 99 weeks of benefits, which average about $300 a week
Extended Home Buyer Credit
The $8,000 home buyers’ tax credit enacted earlier this year and slated to expire on November 30th 2009, will now continue until April 30 and contain the following new provisions.
- First-time home buyers who close before April 1 would get the full $8,000, and the credit’s value would be reduced by $2,000 in each successive quarter until expiring at the end of the year.
- The plan would extend the credit, due to expire Nov. 30, to home purchases under contract by April 30, 2010, with borrowers allowed another 60 days to close the sale, according to a person familiar with the details of the agreement.
- Current Homeowners looking for a new home could also qualify for a $6,500 credit if they have lived in their existing primary residence for at least five years
- The home buyers’ credit would be available to individuals earning up to $125,000, or $250,000 for couples, up from $75,000 for individuals and $150,000 for couples under the current law.
- Tax Credit Exclusions: Homes that cost more than $800,000 aren’t eligible for the credit and you must be over 18 years old to claim the credit. Those who sell their new home or stop using it as their main residence within three years would have to repay the credit.
Shop and Compare multiple Home Insurance quotes for free.
The Treasury Department estimates that more than 1.4 million Americans have taken advantage of the home buyer credit at a cost so far of about $10 billion. Democrat leaders say expanding the credit to those who already own homes would help create jobs because “the move-up buyer is more inclined and capable of buying that furniture, maybe building a porch, putting a garage on, a new roof” and making the “kinds of investments I think is going to be a job-creator across the country.” Republicans, called the tax credit a waste of money, saying studies show that most of those claiming the break would have bought homes anyway.
Goldman Sachs Group Inc. said in a research note yesterday that the credit probably spurred 200,000 home sales that otherwise wouldn’t have occurred. Extending the credit to people who own homes wouldn’t reduce the excess housing blamed for the slump because “every buyer taking advantage of the move-up credit would necessarily be a seller,” Goldman Sachs said. It said the plan may increase housing prices by 1 percent because “sellers are likely to incorporate a fraction of the credit amount in their sale prices.”
The senate approved legislation also would expand provisions in the stimulus package allowing companies to apply their losses to previous years’ income, thereby reducing their tax bills and allowing them to claim refunds. Banks and other institutions receiving assistance from the Treasury Department’s TARP program wouldn’t be eligible.
Lawmakers are still considering whether to extend several other elements of the stimulus package, including subsidies to help the jobless buy health insurance and increased funds for food stamps. Obama has also called for sending seniors $250 checks because they won’t get a cost-of-living increase next year in their Social Security checks. I will provide updates on these and progress of the above bill through Congress, and encourage you to subscribe (free) via Email or RSS to get the latest news.
References : Bloomberg
Related:
~ FHA vs Conventional Home Loan – Comparing the Difference
~ Should I Refinance my Mortgage and Do I Qualify
~ Top ten myths about buying a franchise
More Related posts:
- American Jobs and Closing Tax Loopholes Act of 2010 (HR 4213) Update – New Tax Breaks, Unemployment Insurance and Home Buyer Credit Extension
- No Increase, but Congress to Extend $8000 First-time Home Buyer Tax Credit into 2010 and Make Available to More Home Buyers and Owners
- Updates on 2010 Government Tax Credits – Home Buyer Credit Filing Extension, $250 SSI and Medicare Gap Payments, Teacher Credits and Unemployment Insurance
- New Bills for 2010 Home Buyer Credit and Unemployment Insurance Extension
- 2010 HIRE Act – Small Business Health Care Tax Credit, Payroll Tax Incentive and Business Credit For Employers Hiring and Retaining Unemployed Workers
{ 14 comments… read them below or add one }
who really gives a crap anyways why just dont the goverment give these tier5 tier6 or whatever until thing pick up more better for jobs in this country isnt it for the people by the people? let the rich pay for the unemployment they dont pay taxes half the time anyways ; [
The entire United States population, including the wealthy, need the Tier 5 Unemployment Extension much more than they need the Bush tax cuts. Why doesn’t the media focus on this more. Those that are affected by the bush tax cuts already have jobs!
YES WE Need a Tier5 that extends unemployment benefits until such a time as unemployment is below 5% for 26 consecutive weeks AND employers that discriminate against the unemployed are fined a total of 30% of their reported profits from the last 10 years. IF CONGRESS Refuses to ACT then the unemployed will have no choice but to march on Washington and shut the city down until such a time as the politicians listen to the concerns and take actions to eliminate unemployment
The latest reports from within Congress seem to indicate that the ‘Americans Want to Work Act’ or S.3706 unemployment extension bill presented by Senator Debbie Stabenow (D-MI) has NOT been included in the Senate’s schedule. Despite the fact that most people in America realize and agree that a new Tier 5 unemployment benefits scheme is now necessary even if it results in a higher deficit, Congress seems quite happy to delay any debate on this topic till after the upcoming mid-term elections. Congress insiders have also pointed out that there is no real point discussing Senator Stabenow’s bill or any other bill that proposes unemployment benefits extensions, as they are all dependent on the existing tiers of unemployment benefits, which are due to expire on the 30th of November.
Advocates for the unemployment extension point out that in extending current tiers of unemployment benefits as well as adding a new 5th Tier of benefits, Congress will be throwing a vital lifeline to many families affected by the economic conditions, as well as putting money in the hands of these people which will in turn provide the the stalling economy with much needed stimulus.
tier5 once more we are going down a big hole the porta poty. this tier would be heaven sent and will help some of us get by until more jobs open up. so please MR. oboma are chef and comander will you do your best to get this going . what if it was your kids and wife would you do somyhing then. you know the answer. you would be tripping over your feet. just try and see no more trips to spain. the good life gone .all we do is cry and worry and worry,worry and some more crying and worrying. p.s. the spending will boost the econamy and are hope;s. do me a faver ask one of your girls what they would do. the congress have all the money and then some ask them if that money was all gone would they sit on there hands and laugh. we hav;nt laughed or had fun in years. lost all that we have worked are hole life for.
Everyone keeps saying you get 99 wks. of unemployment. THIS IS NOT TRUE. you may get 99 wks. as long as there is an extension for you to claim those weeks. WITHOUT AN EXTENSION YOU CAN NOT MOVE ONTO THE NEXT TIER THAT YOU HAVE. THEREFORE, YOU ARE SCREWED OVER; NO MORE ELIGIBLE UNEMPLOYMENT WHEN YOU NEED IT MOST. The government may see the unemployed people rise up as if they were in France, and DEMAND UNEMPLOYMENT EXTENSION IMMEDIATELY. People who have lost unemployment, there homes, and have children to take care of may begin to feel like they have nothing to loose. They have already lost it all. WHEN YOU GET TO THE POINT OF NO RETURN, YOU DO THINGS YOU NORMALLY WOULDN’T DO. PLEASE FOR EVERYONE’S WELL BEING ,PASS THIS EXTENSION NOW, AND STOP MAKING THE UNEMPLOYED PAY FOR THE GOVERNMENT’S MISTAKES.Put these people back to work, then the government can worry about paying off what it owes.
The NYS unemployment rate released for April, May and June was 8.3 percent, just below the 8.5 percent threshold to receive 99 weeks of assistance. This means New York State unemployment benefits will be extended for 93 weeks because the unemployment rate is down. While this is good news for New Yorkers now working, it is problematic for those who still cannot secure employment.
I lost my job in May of 2009 after a hospital that I worked at for 10 years was closed by a major corporation in Philadelphia. I immediately signed up for school and unemployment and have been blessed enough to receive the unemployment thus far. I have applied to countless jobs so that I can work AND go to school. Guess what! I have gotten calls, I have gotten interviews – but I HAVEN’T gotten a job! So, thank GOD that I have still been taking classes. Maybe by the time I graduate with a degree as a nurse, I’ll be able to find a job. I feel like I’ve been the victim of AGE DESCRIMINATION – in spite of having experience – other “more experienced” people have gotten the jobs………hmmmmm. Should we pass the unemployment extension? DUH!!!
Obama and the Democrats are to blame for this whole mess not getting any better. For all those who curse the Republicans, go ahead keep voting for Democrats and live off your piddely unemployment for the rest of your lives. We need sensible government and the Dems are not cutting it. I won’t even benefit from the bill because I already had my 99 weeks. And you know, I don’t even WANT anymore of their blood money. But I’m glad everyone is happy with Obama and Dems taking us down the tubes!
To everyone that is on unemployment and is responding to these blogs. I just contacted my unemployment agency and ask what do I do now that the president has signed the extension. They said it won’t go into affect for at least 2 to 4 weeks. So that is more time families go without because the GOP wanted to play politics with our lives. So we can sit in front of our computers and complain. That might make you feel a little better to let off some steam but the Senators that are blocking the extension benefit bill are not reading these blogs. They don’t care. What we can do is take action. Start calling every Senator that blocked this bill for two months. Most of these guys that opposed the bill are millionaires, so you can see why they don’t care. To find your Senators contact info go to Senate.gov. Once you get their DC office number and fax number blast their phones with calls everyday. Some of them are saying unemployment benefits is just an incentive to not look for work and h
Although the unemployment extension is beneficial, it’s not enough for the “Tier 5 to Survive” movement. The extension of the legislation is only a stepping stone. Those who have pushed and pushed their Senators to pass this bill are not going to be satisified with just this bill. Long term solutions are a must.
What do I think needs to happen? First, think of unemployment as an infection. In a way, it is an infection in our economy. To fight an infection, first you have to treat the symptoms and then get rid of the root cause.
The treatment is to give unemployment benefits to the jobless. To end this once and for all, the root cause – a lacking job market and a horrific economy – must be nursed back to health.
Giving employers incentives to hire workers is one way to treat this ailment. Another way would coincide with one of Obama’s pet projects – clean energy. By pressing on with clean energy, you will create jobs. People must build nuclear power plants and wind farms – and then they must be maintained. High paying jobs such as scientists and engineers are necessary to make sure every thing works
I’m glad that the senate passed a benefits extension for those that have been unemployed for less than a year and a half. I’m not going to blather on about my bills, the tax’s I’ve payed and so on. But the congress did not pass a true extension. A true extension would have covered all people who lost their jobs greater than a year and a half ago.
I’ve listened to and read many statements about the republicans being cold hearted and not caring which sometimes they are. Now Californias 99ers do a lot of Republican bashing when they should be looking to home ( Nancy Polosies statement that there will not be a tier 5).
As one of the mature long-term unemployed, I will be homeless in eight days. I average 35 resumes sent per week and two interviews per month. For 38 years I have supported myself, for twenty five I supported three children without child support. I don’t have much, but I’ve never wanted the designer clothes or expensive furniture or new car. I thought I would survive this too, I guess I was wrong. Come November I am going to vote for anyone who is not currently holding a political office (or recently was kicked out of one). The GOP wasn’t worried about the national debt when they were bailing out their buddies in the banks and on Wall Street were they? What happened to representing all the people? Someone needs to wake up Congress to the roughly 5.2 million people who now cannot pay their rent/mortgage, cannot buy gas, pay a electric bill or even buy food. Does that make good national economic sense?
Beyond frustrated. I have been out of work since last August. Been trying to find work constantly, but jobs at my level and looking for my qualifications are few and far between. To try to balance the budget on the backs of the unemployed is political pettiness at its worst, especially when the Right whips up the assinine and insulting argument that extending benefits discourages recipients from trying to find work. Pure nonsense. Unemployment compensation is by no means enough money to live on, especially with a family, car payments and a mortgage, but it helps slow the rate that savings erodes. Plus, none of us CHOSE to be laid off–why should we be forced to grab jobs well below our standard of living out of desperation, setting our families’ finances back years or even decades?
It is also extremely short-sighted to cut off unemployment benefits. There is probably no more efficient way to stimulate the consumer economy than to provide funds to those without any other income, who have to spend it right away. And there is no quicker way to choke off the economy by cutting off such funds.
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