Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Your tax savings - stimulus bill

Congress is still debating the economic stimulus package, and the tax provisions may still be changed. But here's an early look at what they could mean for you.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By Jeanne Sahadi, CNNMoney.com senior writer

Tax savings under stimulus
Lower and middle-income tax filers will get the biggest breaks under the economic recovery package. Here's what the savings could add up to based on the bills before Congress. All provisions could still change.
Status Income Tax savings
Single, no kids $30K $500
Married, 2 kids $30K $1,390
Single, no kids $50K $500
Married, 2 kids $50K $1,000
Single, no kids $76K $500
Married, 2 kids $76K $1,000
Single, no kids $100K None
Married, 2 kids $100K $2,700*
Single, no kids $500K None
Married, 2 kids $500K None
*Savings under House version $1,000
Source:Deloitte Tax

NEW YORK (CNNMoney.com) -- What kinds of tax savings will the stimulus plan offer Americans?

Deloitte Tax crunched some numbers to come up with an initial answer.

To be sure, the data is preliminary. Congress is still hashing out the final terms of President Obama's economic recovery package and a full picture won't emerge until the tax lady sings.

Most of the savings are accounted for by the Make Work Pay Credit, which was a centerpiece of Obama's election campaign. It would be worth up to $500 a year for individuals and up to $1,000 for couples.

The full credit would be available for 2009 and 2010, but is limited to those making $75,000 or less ($150,000 or less for workers filing joint returns).

The Make Work Pay Credit also would be refundable, meaning that even tax filers without any income tax liability -- typically very low-income workers -- would receive one.

An amendment to the Senate bill this week would protect middle- and upper middle-income taxpayers from the Alternative Minimum Tax. The AMT was intended primarily for high-income taxpayers but has in recent years threatened to engulf those lower down the income scale. That provision is not in the current House bill, but may make its way to the final bill.

The amount of savings an individual or family receives from the stimulus bill will depend in part on how many children they have. Changes to the Earned Income Tax Credit and the child tax credit will offer big tax savings to very low-income families with three kids or more.

Between those changes and the addition of the Make Work Pay credit, the Tax Policy Center calculates that a family of five making $16,200 a year (assuming each spouse makes $8,100) would get an additional $3,511 as a result of the stimulus bill. That same family would get an extra $1,651 if they made $32,000 a year. To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
Top luxury hotel suites for business travelers For many people, you can't put a price on comfort. More
Million-dollar startups: These firms scored big sales their first year Their first year in business, these companies generated $1 million in sales. More
The 10 best states for retirees It might be worth moving to a new place to find your dream retirement home. Check out these 10 states. More