The recently introduced American Jobs and Closing Tax Loopholes Act (Bill: HR 4213) includes important tax cuts to put more money back into the pockets of American families and workers. This new bill extends critical tax cuts through the end of 2010 so families and workers can receive the full benefits of these tax cuts on their 2010 tax returns and, therefore, have more money to spend on the items they need like gas and groceries. The proposals are estimated to provide American families with an additional $5 billion of tax cuts in 2010. Specific tax breaks and credits include:
Tax Cut for College Tuition – This bill extends a tax deduction for qualified education expenses including college tuition and fees, so Americans can get the world-class education they deserve without going bankrupt in the process.
Property Tax Deduction – This bill extends the additional standard deduction for state and local property taxes to save families money on their federal tax returns. This deduction allows taxpayers who do not itemize their tax deductions to receive property tax relief as a standard deduction of $500 for single filers and $1,000 for joint filers.
Tax Cut for School Teachers – This bill extends a $250 tax deduction for teachers who buy classroom supplies out of their own pockets, so teachers can continue to provide a quality education. It covers expenses paid or incurred for books, supplies (other than non-athletic supplies for courses of instruction in health or physical education), computer equipment (including related software and service), other equipment, and supplementary materials used by the educator in the classroom.
Sales Tax Deduction – This bill extends the option for taxpayers to deduct state and local sales tax on their federal tax returns, so families can continue to save money with the tax deductions they count on.
Tax Cut for Energy-Efficient Homes – This bill updates the eligibility for tax credits for energy-efficient windows, so even more families across the country can take advantage of this tax cut.
Unemployment Insurance – This bill extends eligibility for unemployment insurance through the end of this year, so families and communities can continue to receive the benefits they depend on as Congress works to create jobs. Without this extension, eligibility for federal benefits will expire at the end of May and workers who have lost their jobs through no fault of their own will lose the benefits they depend on to pay the rent and put food on the table while they look for work. This bill continues full federal funding of extended unemployment insurance benefits to ensure states can continue to provide unemployed workers with 13 to 20 additional weeks of benefits. It also extends the Additional Compensation Program to continue providing unemployed workers with an additional $25 per week to make ends meet in this tough economy.
COBRA Health Care Tax Credit – This bill extends eligibility for the 65 percent COBRA tax credit to help workers who have been laid off maintain their health insurance while they look for work.
The above tax breaks are part of bill H.R. 4213, which was recently approved by the house and will soon be voted on by the Senate and then signed into law by the President. I will continue to monitor this bill as it progresses through Congress and encourage you to subscribe (free) via Email or RSS to get the latest news along with all the other stimulus payments in 2010 and 2011. You can read the full bill and get more details here.