How will ARRA benefit individuals and families?
ARRA provides a number of tax incentives for individuals and families. Here is a summary of key ARRA tax provisions of benefit to average citizens: • Making Work Pay: Provides immediate and sustained tax relief to about 95 percent of workers through a refundable tax credit of $400 to individuals and $800 to couples. • First-Time Homebuyers: Increases the first-time homebuyers tax credit from $7,500 to $8,000. • Deduction for Vehicle Purchases: Provides a tax credit deduction for state and local sales taxes paid on the purchase of new cars including light trucks and SUVs. • Education Tax Credit: Provides financial assistance for individuals seeking a college education. Taxpayers will receive up a tax credit of up to $2,500 of the cost of college tuition and related expenses. • Child Care Credit: Cuts taxes for families through an expansion of the child tax credit to the extent of 15 percent of the taxpayer’s earned income of excess of $8,500. • Earned Income Credit: Expands the Earned I
