President-elect Barack Obama is expected to begin working on passing an economic stimulus package even before he takes office.
Congress will begin a lame-duck session later this month in which it is expected to consider a short-term stimulus package to boost the economy. Likewise, Obama has proposed a stimulus package estimated to cost between $175 billion and $190 billion. Among the provisions is a windfall profits tax on oil company income, which would be used to provide families with a $1,000 emergency energy rebate.
Businesses would also receive a $3,000 refundable tax credit for each new full-time employee they hire in the U.S. in the next two years. Small businesses would be able to write off up to $250,000 for new equipment and property they buy up to the end of next year. The stimulus package passed earlier this year provided the write-off only for purchases through the end of 2008.
Obama also wants to increase spending on infrastructure projects, extend unemployment benefits and boost home heating aid. He has also proposed allowing holders of tax-deferred retirement accounts to temporarily make penalty-free withdrawals of 15%, up to $10,000.
Longer term, Obama's proposals include a tax credit of up to $500 per working person, or $1,000 per family, and the elimination of income taxes for all seniors who make less than $50,000 annually.
Obama has pledged to cut taxes for all families and workers who earn less than $200,000 per year, but to raise taxes for those who make more than $250,000 by letting the Bush tax cuts expire.
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