From the office of Del. Mary-Dulany James:
I wanted to call to your attention some exciting news from Washington, DC. On December 17, 2010, President Obama signed the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. This bill will extend tax cuts for all Americans with the intention of creating jobs and getting our economy working again for all of us. While change may not happen overnight, relief is on the way.
The key provisions extend tax cuts for two years, reduce payroll taxes by 2 percent in the coming year and extend unemployment benefits another 13 months. I feel that these aspects will support Marylanders who are feeling the stress of this difficult economy. Overall, these provisions will hopefully provide relief to more than 100 million middle-class families and prevent an annual tax increase of over $2,000 for the typical family. The provisions that I think will most help:
– Extend the 2001 and 2003 tax cuts for all taxpayers for 2011 and 2012:
Keep the current tax rates at all income levels;
Repeal the phase-outs of personal exemptions and itemized deductions;
Keep the top capital gain and dividend rate at 15%;
Maintain marriage penalty relief; and
Continue the $1,000 child tax credit;
– Cut approximately 2 percent in employee-side payroll taxes for over 155 million workers – providing tax relief of about $112 billion next year;
– Reduce the employee share of Social Security (“FICA”) taxes from 6.2% to 4.2% for normal employees and from 12.4 percent to 10.4 percent for self-employed individuals;
– Patch the alternative minimum tax (“AMT”) for two years to ensure an additional 21 million households will not face a tax increase;
– Provide an estate, gift and generation-skipping transfer tax rate of 35% and exemption amount of $5 million for 2 years;
– Extend unemployment benefits for 13 months preventing an estimated 7 million workers from losing their benefits over the next year as they search for jobs; and
– Extend various expiring tax provision that have benefited both individuals and businesses, such as the tax cuts enacted by the stimulus bill of 2009 and many of the tax provisions commonly referred to as “extenders.”
These provisions include things such as:
American Opportunity Credit;
Earned income tax credit enhancements;
Child credit enhancements;
Research credit; and
Itemized deduction for state and local sales taxes.
I think this is all very good news we got right before the holidays. Instead of waiting for the new year, leaving our tax rates in question, Congress ensured that Americans get the relief they need now.
Please accept the very best wishes from my family and me to you and yours during this holiday season.
Very Truly Yours,