As the economy struggles to regain its footing, the government is constantly looking for ways to help spur growth and provide aid to those who need it. Congress recently passed new legislation designed to help offset the continuing increase in unemployment, which is expected to top 10% nationwide before the end of the year, and the housing market which is slowly beginning to stabilize in many areas. President Obama is expected to sign the new legislation into law by the end of the week to enact the changes as quickly as possible.
Everyone will benefit from a stronger economy but there are a few groups of people and businesses that stand to benefit most directly from the new legislation.
- Unemployed Workers: Unemployment benefits are a huge help to those who lose their jobs unexpectedly, but many find themselves running out of the allotted time to receive benefits and still without much in the way of prospects for employment. The new legislation will extend unemployment benefits for workers across the nation by 14 weeks, or just over three months. In addition, states with unemployment rates over 8.5% will give jobless workers an extra six weeks on top of those 14 that are being received nationwide.
This new legislation is a huge help to the thousands of people who have run out of benefits. Most states offer jobless benefits that last for six months, but more than 30% of unemployed Americans have been out of work for longer than six months. Congress has been debating this bill for almost 2 months and during that time 7,000 Americans have seen their jobless benefits expire each day. Now, these workers will be able to reapply and receive the extended benefits.
- Home Buyers: The legislation provides tax incentives to a couple of categories of home buyers. For first time buyers who have not yet taken advantage of the $8000 tax poor credit history that was set to end on November 30, that tax poor credit history will now extend to home purchases that close prior to June 30, 2010. In addition, homeowners that have owned a residence for more than 5 years and purchase a new home will be eligible for a $6500 tax poor credit history. These changes should be good for the housing market as a whole and will also benefit homebuilders who have struggled to stay in business over the past few years.
- Businesses: As consumers have struggled financially, businesses have also suffered. A provision in the bill will provide tax relief to companies that have lost money over the past few years by allowing them to apply losses from the last two years to their tax returns of the past 5 years, earning an IRS refund that will be paid out in cash. The tax break will be offered to all businesses except those that received TARP funds from the government during previous bailouts. This change should provide a much-needed cash infusion to businesses and the hope is that some will use the inflow to grow their company and begin hiring again.
