* Millions of workers can expect to see about $13 extra in their weekly paychecks, starting around June, from a new $400 tax credit to be doled out through the rest of the year. Dual income households would get up to $800. In 2010, the credit would be about $7.70 a week, if it is spread over the entire year.
This is insignificant to most people ($13/week?) but in aggregate it is VERY expensive.
* The $1,000 child tax credit would be extended to more low-income families that don't make enough money to pay income taxes, and poor families with three or more children will get an expanded Earned Income Tax Credit.
This will clearly help some struggling low-income households, but the politics of this are tricky.
* Middle-income and wealthy taxpayers will be spared from paying the Alternative Minimum Tax, which was designed 40 years ago to make sure wealthy taxpayers pay at least some tax, but was never indexed for inflation. Congress fixes it each year, usually in the fall.
This isn't a major shift - Congress just pulled forward their planned patch for the Alt Min tax.
* First-time homebuyers who purchase their homes before Dec. 1 would be eligible for an $8,000 tax credit, and people who buy new cars before the end of the year can write off the sales taxes.
There are a lot of caveats to receiving these credits or deductions (you have to buy a purple house on an odd number street on a Thursday in a county which starts with the letter Y, etc).* Homeowners who add energy-efficient windows, furnaces and air conditioners can get a tax credit to cover 30 percent of the costs, up to a total of $1,500.
This remains a good idea - but it's a challenge to define energy efficient windows and furnaces.
* College students — or their parents — are eligible for tax credits of up to $2,500 to help pay tuition and related expenses in 2009 and 2010.
I hate these overly simplified ideas. It creates an artificial floor for college costs. If people are struggling to pay for college, then colleges need to cut their price or fail. Rather than waste money supporting the antiquated college system in the US that is producing first round draft picks in beer pong and quarters, but very few that can name 50% of the periodic table of elements, how about reinventing the college system. I think we need to create regional technical institutes that will train people in specific skills - science, engineering, accounting, etc.
* Finally, those receiving unemployment benefits this year wouldn't pay any federal income taxes on the first $2,400 they receive.
So, while the spin masters on both sides of the political aisle will talk about all of the huge tax cuts in this bill and how they will help you, I think it's pretty clear that while the cuts are huge in aggregate, they're impact on you will be relatively small.