1. First Time Homebuyers Credit. This credit was originally enacted in 2008, but was extended and enhanced twice in 2009, most recently in The Worker, Homeownership, and Business Assistance Act of 2009. A tax credit of up to $8,000 is now available for qualified first-time homebuyers in 2009. In addition, a tax credit of up to $6,500 is available for qualified existing homeowners who purchase a new principal residence.
2. Making Work Pay Credit. This credit is targeted to lower and middle income taxpayers and is equal to a maximum of $400 for individuals and $800 for married couples. To qualify for the maximum credit, a single person must have earned income of no more than $75,000 and no partial credit is given if earned income exceeds $95,000. For married couples, the earned income limit for a maximum credit is $150,000 with individuals making $190,000 or more receiving no credit.
3. Unemployment Compensation. The first $2,400 of unemployment compensation received in 2009 in excluded from income for federal income tax purposes. This exclusion was only for 2009 and has expired unless it is adopted again sometime this year.
4. Sales and Use Tax Paid on Automobiles. This is a temporary deduction for sales and excise taxes paid relating to the purchase of a qualified new automobile, light truck, or motorcycle purchased through December 31, 2009.
5. Education Incentives. The Recovery Act significantly enhanced the HOPE scholarship credit and renamed it the American Opportunity Tax Credit (AOTC). The new credit has a higher maximum credit amount, is partially refundable, and is available to some higher income earners. It is also expanded to apply to the first four years of post-secondary educations (as opposed to two before.) This credit is set to expire at the end of 2010.
6. Child Tax Credit. The Recovery Act enhanced the child tax credit by making a larger portion of the credit refundable for 2009 and 2010.
7. Earned Income Tax Credit. The Recovery Act increased the Earned Income Tax Credit.
8. Bonus Depreciation. The 2009 American Recovery and Reinvestment Act (“Recovery Act”) extended bonus depreciation deduction for property placed in service in 2009. This allows businesses to deduct 50% of the qualifying property in the first year that it is placed in service.
9. Section 179 Expensing. The Recovery Act also extended the $250,000 limit on qualifying property that can be expensed by qualifying small businesses under Section 179.
10. Work Opportunity Tax Credit Expansion. The credit rewards employers that hire individuals from targeted groups. The Recovery Act expanded the targeted group to unemployed veterans and disconnect youth.
11. Energy Tax Credits. The 2009 Recovery Act expanded and extended many energy tax incentives for businesses.
12. COBRA Premium Assistance. This provision allows individuals that have been involuntarily terminated to pay only 35% of their COBRA health insurance premiums to their former employers for nine months, and their former employers are required to treat this as full payment. The employers then get to claim a tax credit for the other 65% of the premium on their payroll tax returns. Thus, it should result in no additional liability to the employee or the employer. Currently, COBRA Premium Assistance is only available for individuals involuntarily terminated prior to February 28th, 2010. There are a couple of bills that are proposing to extend this even further.
13. NOL Carryback. Both of the major acts past this year expanded the ability of small and medium sized businesses to count the losses sustained in 2008 or 2009 to recoup taxes paid in the prior five years.

Shame, shame on those dems for not giving the little people a break. Tsk tsk.

WITHIN THE FIRST YEAR OF ENACTMENT

*Insurance companies will be barred from dropping people from coverage when they get sick. Lifetime coverage limits will be eliminated and annual limits are to be restricted.

*Insurers will be barred from excluding children for coverage because of pre-existing conditions.

*Young adults will be able to stay on their parents’ health plans until the age of 26. Many health plans currently drop dependents from coverage when they turn 19 or finish college.

*Uninsured adults with a pre-existing conditions will be able to obtain health coverage through a new program that will expire once new insurance exchanges begin operating in 2014.

*A temporary reinsurance program is created to help companies maintain health coverage for early retirees between the ages of 55 and 64. This also expires in 2014.

*Medicare drug beneficiaries who fall into the “doughnut hole” coverage gap will get a $250 rebate. The bill eventually closes that gap which currently begins after $2,700 is spent on drugs. Coverage starts again after $6,154 is spent.

*A tax credit becomes available for some small businesses to help provide coverage for workers.

*A 10 percent tax on indoor tanning services that use ultraviolet lamps goes into effect on July 1.

WHAT HAPPENS IN 2011

*Medicare provides 10 percent bonus payments to primary care physicians and general surgeons.

*Medicare beneficiaries will be able to get a free annual wellness visit and personalized prevention plan service. New health plans will be required to cover preventive services with little or no cost to patients.

*A new program under the Medicaid plan for the poor goes into effect in October that allows states to offer home and community based care for the disabled that might otherwise require institutional care.

*Payments to insurers offering Medicare Advantage services are frozen at 2010 levels. These payments are to be gradually reduced to bring them more in line with traditional Medicare.

*Employers are required to disclose the value of health benefits on employees’ W-2 tax forms.

*An annual fee is imposed on pharmaceutical companies according to market share. The fee does not apply to companies with sales of $5 million or less.

WHAT HAPPENS IN 2012

*Physician payment reforms are implemented in Medicare to enhance primary care services and encourage doctors to form “accountable care organizations” to improve quality and efficiency of care.

*An incentive program is established in Medicare for acute care hospitals to improve quality outcomes.

*The Centers for Medicare and Medicaid Services, which oversees the government programs, begin tracking hospital readmission rates and puts in place financial incentives to reduce preventable readmissions.

WHAT HAPPENS IN 2013

*A national pilot program is established for Medicare on payment bundling to encourage doctors, hospitals and other care providers to better coordinate patient care.

*The threshold for claiming medical expenses on itemized tax returns is raised to 10 percent from 7.5 percent of income. The threshold remains at 7.5 percent for the elderly through 2016.

*The Medicare payroll tax is raised to 2.35 percent from 1.45 percent for individuals earning more than $200,000 and married couples with incomes over $250,000. The tax is imposed on some investment income for that income group.

*A 2.9 percent excise tax in imposed on the sale of medical devices. Anything generally purchased at the retail level by the public is excluded from the tax.

WHAT HAPPENS IN 2014

*State health insurance exchanges for small businesses and individuals open.

*Most people will be required to obtain health insurance coverage or pay a fine if they don’t. Healthcare tax credits become available to help people with incomes up to 400 percent of poverty purchase coverage on the exchange.

*Health plans no longer can exclude people from coverage due to pre-existing conditions.

*Employers with 50 or more workers who do not offer coverage face a fine of $2,000 for each employee if any worker receives subsidized insurance on the exchange. The first 30 employees aren’t counted for the fine.

*Health insurance companies begin paying a fee based on their market share.

WHAT HAPPENS IN 2015

*Medicare creates a physician payment program aimed at rewarding quality of care rather than volume of services.

WHAT HAPPENS IN 2018

*An excise tax on high cost employer-provided plans is imposed. The first $27,500 of a family plan and $10,200 for individual coverage is exempt from the tax. Higher levels are set for plans covering retirees and people in high risk professions.

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FACTBOX-US healthcare bill would provide immediate benefits