Revenue Act of 1924
The United States Revenue Act of 1924 known as the Mellon tax bill cut federal tax rates and established the U. S. Board of Tax Appeals, renamed the United States Tax Court in 1942; the bill was named after U. S. Secretary of the Treasury Andrew Mellon; the Revenue Act was applicable to incomes for 1924. The bottom rate, on income under $4,000, fell from 1.5% to 1.125%. A parallel act, the Indian Citizenship Act of 1924, granted all non-citizen resident Indians citizenship, thus the Revenue Act declared that there were no longer any "Indians, not taxed" to be not counted for purposes of United States Congressional apportionment. President Calvin Coolidge signed the bill into law. Both a normal Tax and a surtax were levied against the net income of individuals, as shown in the following table: Exemption of $1,000 for single filers and $2,500 for married couples and heads of family. A $400 exemption for each dependent under 18
Economic Recovery Tax Act of 1981
The Economic Recovery Tax Act of 1981 known as the ERTA or "Kemp–Roth Tax Cut", was a federal law enacted by the 97th United States Congress and signed into law by President Ronald Reagan. The act was a major tax cut designed to encourage economic growth. Republican Congressman Jack Kemp and Republican Senator William Roth had nearly won passage of a tax cut during the presidency of Jimmy Carter, Reagan made a major tax cut his top priority upon taking office. Though Democrats maintained a majority in the House of Representatives during the 97th Congress, Reagan was able to convince conservative Democrats like Phil Gramm to support the bill. ERTA passed Congress on August 4, 1981, was signed into law on August 13, 1981. ERTA was one of the largest tax cuts in U. S. history, ERTA and the Tax Reform Act of 1986 are known together as the Reagan tax cuts. Along with spending cuts, Reagan's tax cuts were the centerpiece of what some contemporaries described as the conservative "Reagan Revolution."
Included in the act was an across-the-board decrease in federal income tax rates. The top marginal tax rate fell from 70 percent to 50 percent, the bottom rate dropped from 14 percent to 11 percent. To prevent future bracket creep, the new tax rates were indexed for inflation. ERTA slashed estate taxes, capital gains taxes, corporate taxes. Critics of the act claim that it worsened federal budget deficits, while supporters credit it for bolstering the economy during the 1980s. Due to deficit concerns in the midst of the early 1980s recession, many of the cuts implemented by ERTA were rescinded by the Tax Equity and Fiscal Responsibility Act of 1982; the Office of Tax Analysis of the United States Department of the Treasury summarized the tax changes as follows: phased-in 23% cut in individual tax rates over 3 years. The maximum expense in calculating credit was increased from $2000 to $2400 for one child and from $4000 to $4800 for two or more kids; the credit increased from a maximum of $400 or $800 to 30 % of $10,000 income or less.
The 30% credit is diminished by 1% for every $2,000 of earned income up to $28000. At $28000, the credit for earned income is 20%; the amount a married taxpayer who files a join return increased under the Economic Recovery Tax Act to $125,000 from $100,000, allowed under the 1976 Act. A single person is limited to an exclusion of $62,500, it increases the amount of a one time exclusion of gain realized on the sale of principal residence by a persons at least 55 years old. Republican Congressman Jack Kemp and Republican Senator William Roth had nearly won passage of a major tax cut during the presidency of Jimmy Carter, but President Carter had prevented passage of the bill due to concerns about the deficit. Supply-side economics advocates like Kemp and Reagan asserted that cutting taxes would lead to higher government revenue due to economic growth, a proposition, challenged by many economists. Upon taking office, Reagan made the passage of Kemp-Roth bill his top domestic priority; as Democrats controlled the House of Representatives, passage of any bill would require the support of some House Democrats in addition to the support of congressional Republicans.
Reagan's victory in the 1980 presidential campaign had united Republicans around his leadership, while conservative Democrats like Phil Gramm of Texas were eager to back some of Reagan's conservative policies. Throughout 1981, Reagan met with members of Congress, focusing on winning support from conservative Southern Democrats. In July 1981, the Senate voted 89-11 in favor of the tax cut bill favored by Reagan, the House subsequently approved the bill in a 238-195 vote. Reagan's success in passing a major tax bill and cutting the federal budget was hailed as the "Reagan Revolution" by some reporters; the Accelerated Cost Recovery System was a major component of the ERTA and was amended in 1986 to become the Modified Accelerated cost Recovery System. The system changed the way. Instead of basing the depreciation deduction on an estimate of the expected useful life of assets, the assets were placed into categories: 3, 5, 10, or 15 years of life. For example, the agriculture industry saw a re-evaluation of their farming assets.
Items such as automobiles and swine were given 3 year depreciation values, things like buildings and land had a 15-year depreciation value. The idea was that there would be a rise in tax cuts due to the optimistic consideration of depreciating values; this would in turn put more cash into the pockets of business owners to promote investment and economic growth. The most lasting impact and significant change of the Act was the indexing of the tax code parameters for inflation starting in years after 1984. Of the nine federal tax laws between 1968 and this Act, si
Andrew William Mellon, sometimes A. W. was an American banker, industrialist, art collector, politician. From the wealthy Mellon family of Pittsburgh, Pennsylvania, he established a vast business empire before transitioning into politics, he served as United States Secretary of the Treasury from March 9, 1921, to February 12, 1932, presiding over the boom years of the 1920s and the Wall Street crash of 1929. A conservative Republican, Mellon favored policies that reduced taxation and the national debt in the aftermath of World War I. Mellon's father, Thomas Mellon, rose to prominence in Pittsburgh as a attorney. Andrew began working at his father's bank, T. Mellon & Sons, in the early 1870s becoming the leading figure in the institution, he renamed T. Mellon & Sons as Mellon National Bank and established another financial institution, the Union Trust Company. By the end of 1913, Mellon National Bank held more money in deposits than any other bank in Pittsburgh, the second-largest bank in the region was controlled by Union Trust.
In the course of his business career, Mellon owned or helped finance Alcoa, the New York Shipbuilding Corporation, Old Overholt whiskey, Standard Steel Car Company, Westinghouse Electric Corporation, the Pittsburgh Coal Company, the Carborundum Company, Union Steel Company, the McClintic-Marshall Construction Company, Gulf Oil, numerous other businesses. He was an influential donor to the Republican Party during the Gilded Age and the Progressive Era. In 1921, newly-elected President Warren G. Harding chose Mellon as his Secretary of the Treasury. Mellon would remain in office until 1932, serving under Harding, Calvin Coolidge, Herbert Hoover, all three of whom were members of the Republican Party. Mellon sought to reform federal taxation in the aftermath of World War I, cutting taxes on top earners but leaving in place a progressive income tax; some of Mellon's proposals were enacted by the Revenue Act of 1921 and the Revenue Act of 1924, but it was not until the passage of Revenue Act of 1926 that the "Mellon plan" was realized.
He presided over a reduction in the national debt, which dropped in the 1920s. Mellon's influence in state and national politics reached its zenith during Coolidge's presidency. Journalist William Allen White noted that "so did Andrew Mellon dominate the White House in the days when the Coolidge administration was at its zenith that it would be fair to call the administration the reign of Coolidge and Mellon." Mellon's national reputation collapsed following the Wall Street Crash of 1929 and the onset of the Great Depression. Mellon participated in various efforts by the Hoover administration to revive the economy and maintain the international economic order, but he opposed direct government intervention in the economy. After Congress began impeachment proceedings against Mellon, President Hoover shifted Mellon to the position of United States ambassador to the United Kingdom. Mellon returned to private life after Hoover's defeat in the 1932 presidential election by Franklin D. Roosevelt. Beginning in 1933, the federal government launched a tax fraud investigation on Mellon, leading to a high-profile case that ended with Mellon's exoneration.
Shortly before his death in 1937, Mellon helped establish the National Gallery of Art, a national art museum. His philanthropic efforts played a major role in the establishment of Carnegie Mellon University and the National Portrait Gallery. Mellon's paternal grandparents, both of whom were Ulster Scots, migrated to the United States from County Tyrone, Ireland in 1818. With their son, Thomas Mellon, they settled in Pennsylvania. Thomas Mellon established a successful legal practice in Pittsburgh, in 1843 he married Sarah Jane Negley, an heiress descended from some of the first settlers of Pittsburgh. Thomas became a wealthy landowner and real estate speculator, he and his wife had eight children, five of whom survived to adulthood. Andrew Mellon, the fourth son and sixth child of Thomas and Sarah, was born in 1855. Though he lacked strong convictions about slavery, Thomas Mellon became a prominent member of the local Republican Party, in 1859 he won election to a position on the Pennsylvania court of common pleas.
Because Thomas was suspicious of both private and public schools, he built a schoolhouse for his children and hired a teacher. In 1869, after leaving his judicial position, Thomas Mellon established T. Mellon & Sons, a bank located in Pittsburgh. Andrew joined his father at the bank becoming a valued employee despite being in his early teens. Andrew attended Western University, but he never graduated. After leaving Western University, Andrew worked at a lumber and coal business before joining T. Mellon & Sons as a full-time employee in 1873; that same year, the Panic of 1873 devastated the local and national economy, wiping out a portion of the Mellon fortune. With Andrew taking a leading role at T. Mellon & Sons, the bank recovered, by late 1874 the bank's deposits had reached the level they had been at prior to the onset of the Panic. Mellon's role at T. Mellon & Sons continued to grow after 1873, in 1876 he was given power of attorney to direct the operations of the bank; that same year, Thomas introduced his son to Henry Clay Frick, a customer of the bank who would become one of Mellons's closest friends.
In 1882, Thomas turned over full ownership of the bank to his son, but Thomas continued to be involved in the bank's activities. Five years Mellon's younger brother, Richard B. Mellon, joined T. Mellon & Sons as a co-owner and vice p
Tax Reform Act of 1986
The U. S. Congress passed the Tax Reform Act of 1986 to simplify the income tax code, broaden the tax base and eliminate many tax shelters. Referred to as the second of the two "Reagan tax cuts", the bill was officially sponsored by Democrats, Richard Gephardt of Missouri in the House of Representatives and Bill Bradley of New Jersey in the Senate; the Tax Reform Act of 1986 was given impetus by a detailed tax-simplification proposal from President Reagan's Treasury Department, was designed to be tax-revenue neutral because Reagan stated that he would veto any bill, not. Revenue neutrality was achieved by offsetting tax cuts for individuals by eliminating $60 billion annually in tax loopholes and shifting $24 billion of the tax burden from individuals to corporations by eliminating the investment tax credit, slowing depreciation of assets, enacting a stiff alternative minimum tax on corporations; the top tax rate for individuals for tax year 1987 was lowered from 50% to 38.5%. Many lower level tax brackets were consolidated, the upper income level of the bottom rate was increased from $5,720/year to $29,750/year.
This package consolidated tax brackets from fifteen levels of income to four levels of income. The standard deduction, personal exemption, earned income credit were expanded, resulting in the removal of six million poor Americans from the income tax roll and a reduction of income tax liability across all income levels; the higher standard deduction simplified the preparation of tax returns for many individuals. For tax year 1987, the Act provided a graduated rate structure of 11%/15%/28%/35%/38.5%. Beginning with tax year 1988, the Act provided a nominal rate structure of 15%/28%/33%. However, beginning with 1988, taxpayers having taxable income higher than a certain level were taxed at an effective rate of about 28%; this was jettisoned in the Omnibus Budget Reconciliation Act of 1990, otherwise known as the "Bush tax increase", which violated his Taxpayer Protection Pledge. The Act increased incentives favoring investment in owner-occupied housing relative to rental housing. Prior to the Act, all personal interest was deductible.
Subsequently, only home mortgage interest was deductible, including interest on home equity loans. The Act phased out many investment incentives for rental housing, through extending the depreciation period of rental property to 27.5 years from 15-19 years. It discouraged real estate investing by eliminating the deduction for passive losses. To the extent that low-income people may be more to live in rental housing than in owner-occupied housing, this provision of the Act could have had the tendency to decrease the new supply of housing accessible to low-income people; the Low-Income Housing Tax Credit was added to the Act to provide some balance and encourage investment in multifamily housing for the poor. Moreover, interest on consumer loans such as credit card debt was no longer deductible. An existing provision in the tax code, called Income Averaging, which reduced taxes for those only making a much higher salary than before, was eliminated; the Act, increased the personal exemption and standard deduction.
The Individual Retirement Account deduction was restricted. The IRA had been created as part of the Employee Retirement Income Security Act of 1974, where employees not covered by a pension plan could contribute the lesser of $1500 or 15% of earned income; the Economic Recovery Tax Act of 1981 removed the pension plan clause and raised the contribution limit to the lesser of $2000 or 100% of earned income. The 1986 Tax Reform Act retained the $2000 contribution limit, but restricted the deductibility for households that have pension plan coverage and have moderate to high incomes. Non-deductible contributions were allowed. Depreciation deductions were curtailed. Prior to ERTA, depreciation was based on "useful life" calculations provided by the Treasury Department. ERTA set up the "accelerated cost recovery system"; this set up a series of useful lives based on three years for technical equipment, five years for non-technical office equipment, ten years for industrial equipment, fifteen years for real property.
TRA86 lengthened these lives, lengthened them further for taxpayers covered by the alternative minimum tax. These latter, longer lives approximate "economic depreciation," a concept economists have used to determine the actual life of an asset relative to its economic value. Defined contribution pension contributions were curtailed; the law prior to TRA86 was that DC pension limits were the lesser of 25% of compensation or $30,000. This could be accomplished by any combination of elective deferrals and profit sharing contributions. TRA86 introduced an elective deferral limit of $7000, indexed to inflation. Since the profit sharing percentage must be uniform for all employees, this had the intended result of making more equitable contributions to 401's and other types of DC pension plans; the 1986 Tax Reform Act introduced the General Nondiscrimination rules which applied to qualified pension plans and 403 plans that for private sector employers. It did not allow such pension plans to discriminate in favor of compensated employees.
A compensated employee for the purposes of testing a plan's compliance for the 2006 plan year is any employee whose compensation exceeded $95,000 in the 2005 plan year. Therefore, all new hires are by definition nonhighly compensated employees. A plan could not give benefits or contributions on a more favorable basis for
Republican Party (United States)
The Republican Party referred to as the GOP, is one of the two major political parties in the United States. The GOP was founded in 1854 by opponents of the Kansas-Nebraska Act, which had expanded slavery into U. S. territories. The party subscribed to classical liberalism and took ideological stands that were anti-slavery and pro-economic reform. Abraham Lincoln was the first Republican president in the history of the United States; the Party was dominant over the Democrats during the Third Party System and Fourth Party System. In 1912, Theodore Roosevelt formed the Progressive Party after being rejected by the GOP and ran unsuccessfully as a third-party presidential candidate calling for social reforms. After the 1912 election, many Roosevelt supporters left the Party, the Party underwent an ideological shift to the right; the liberal Republican element in the GOP was overwhelmed by a conservative surge begun by Barry Goldwater in 1964 that continued during the Reagan Era in the 1980s. After the Civil Rights Act of 1964 and the Voting Rights Act of 1965, the party's core base shifted, with the Southern states becoming more reliably Republican in presidential politics and the Northeastern states becoming more reliably Democratic.
White voters identified with the Republican Party after the 1960s. Following the Supreme Court's 1973 decision in Roe v. Wade, the Republican Party made opposition to abortion a key plank of its national party platform and grew its support among evangelicals. By 2000, the Republican Party was aligned with Christian conservatism; the Party's core support since the 1990s comes chiefly from the South, the Great Plains, the Mountain States and rural areas in the North. The 21st century Republican Party ideology is American conservatism, which contrasts with the Democrats' liberal platform and progressive wing; the GOP supports lower taxes, free market capitalism, a strong national defense, gun rights and restrictions on labor unions. The GOP was committed to protectionism and tariffs from its founding until the 1930s when it was based in the industrial Northeast and Midwest, but has grown more supportive of free trade since 1952. In addition to advocating for conservative economic policies, the Republican Party is conservative.
Founded in the Northern states in 1854 by abolitionists, modernizers, ex-Whigs and ex-Free Soilers, the Republican Party became the principal opposition to the dominant Democratic Party and the popular Know Nothing Party. The party grew out of opposition to the Kansas–Nebraska Act, which repealed the Missouri Compromise and opened Kansas Territory and Nebraska Territory to slavery and future admission as slave states; the Northern Republicans saw the expansion of slavery as a great evil. The first public meeting of the general anti-Nebraska movement, at which the name Republican was suggested for a new anti-slavery party, was held on March 20, 1854 in a schoolhouse in Ripon, Wisconsin; the name was chosen to pay homage to Thomas Jefferson's Republican Party. The first official party convention was held on July 1854 in Jackson, Michigan. At the 1856 Republican National Convention, the party adopted a national platform emphasizing opposition to the expansion of slavery into U. S. territories. While Republican candidate John C.
Frémont lost the 1856 United States presidential election to James Buchanan, he did win 11 of the 16 northern states. The Republican Party first came to power in the elections of 1860 when it won control of both houses of Congress and its candidate, former congressman Abraham Lincoln, was elected President. In the election of 1864, it united with War Democrats to nominate Lincoln on the National Union Party ticket. Under Republican congressional leadership, the Thirteenth Amendment to the United States Constitution—which banned slavery in the United States—passed the Senate in 1864 and the House in 1865; the party's success created factionalism within the party in the 1870s. Those who felt that Reconstruction had been accomplished, was continued to promote the large-scale corruption tolerated by President Ulysses S. Grant, ran Horace Greeley for the presidency; the Stalwart faction defended Grant and the spoils system, whereas the Half-Breeds pushed for reform of the civil service. The Pendleton Civil Service Reform Act was passed in 1883.
The Republican Party supported hard money, high tariffs to promote economic growth, high wages and high profits, generous pensions for Union veterans, the annexation of Hawaii. The Republicans had strong support from pietistic Protestants, but they resisted demands for Prohibition; as the Northern postwar economy boomed with heavy and light industry, mines, fast-growing cities, prosperous agriculture, the Republicans took credit and promoted policies to sustain the fast growth. The GOP was dominant over the Democrats during the Third Party System. However, by 1890 the Republicans had agreed to the Sherman Antitrust Act and the Interstate Commerce Commission in response to complaints from owners of small businesses and farmers; the high McKinley Tariff of 1890 hurt the party and the Democrats swept to a landslide in the off-year elections defeating McKinley himself. The Democrats elected Grover Cleveland in 1884 and 1892; the election of William McKinley in 1896 was marked by a resurgence of Republican dominance that lasted until 1932.
McKinley promised that high tariffs would end the severe hardship caused by the Pa
Tax Relief and Health Care Act of 2006
The Tax Relief and Health Care Act of 2006, includes a package of tax extenders, provisions affecting health savings accounts and other provisions in the United States. The Act retroactively extended for two years certain provisions that had expired at the end of 2005, including: Above the line deduction for qualified tuition and higher education expenses Elective itemized deduction for state and local general sales taxes Research credit For tax years ending after December 31, 2006, the Act modifies the rules for calculating the research credit: it increases the rates of the alternative incremental credit and creates a new alternative simplified credit Work opportunity tax credit, welfare-to-work tax credit Tax credit for Qualified Zone Academy Bonds Up to $250 above-the-line deduction for certain expenses of elementary and secondary school teachers Expensing of brownfields remediation costs Tax incentives for investment in Washington, DC Indian employment tax credit Accelerated depreciation for business property on Indian reservations Fifteen-year depreciation for qualified leasehold improvements and qualified restaurant property Enhanced charitable deductions—for corporate donations of scientific property used for research, of computer technology and equipment Archer medical savings accounts Suspension of the taxable income limit on percentage depletion for oil and natural gas produced from marginal propertiesIn addition, the Act extended certain provisions that would otherwise expire at the end of 2006, including: Election to treat combat pay as earned income for purposes of calculating the earned income credit Provisions affecting IRS disclosure of certain tax return informationThe Act extended the new markets tax credit through the end of 2008 and requires that future regulations ensure that non-metropolitan counties receive a proportional allocation of qualified entity investments.
The Act extended through December 31, 2008, numerous energy provisions that would otherwise have expired at the end of 2007, including: Tax credit for electricity produced from certain renewable resources Authority to issue clean renewable energy bonds Deduction for energy-efficient commercial buildings Tax credit for new energy-efficient homes Tax credit for residential energy-efficient property Several provisions affect health savings accounts, including provisions dealing with limitations on HSA contributions and tax-free rollovers to HSAs from health reimbursement accounts, flexible spending accounts and individual retirement accounts. Other provisions include: Expansion of the Section 199 domestic production activity deduction to income from Puerto Rico, if all Puerto Rican receipts are subject to federal income tax A refundable credit of 20 percent of the long-term unused alternative minimum tax credits per year for the next five years, subject to certain limitations and phaseouts Enhancing reporting requirements for the exercise of incentive stock options and employee stock purchase plans Reform and expansion of whistleblower awards to certain individuals who provide information regarding violations of the tax laws An increase of the penalty for frivolous tax submissions from $500 to $5,000 and an extension of the scope of the penalty A temporary itemized deduction for qualified mortgage insurance premiums accrued during 2007, subject to limitations and phase-out Increased information sharing between the IRS and certain regional governmental organizations Charitable remainder trusts having unrelated business taxable income are subjected to an excise tax equal to 100% of unrelated business taxable income A technical correction to the Subpart F look-through rule under the Tax Increase Prevention and Reconciliation Act of 2005 Clarifying that the Tax Court has jurisdiction to review requests for equitable innocent spouse relief Expanding the Medicare Recovery Audit Contractor program to all 50 states and making it permanent Ordering the completion without delay of the All-American Canal Lining Project and identifying a 1944 treaty between the US and Mexico as the exclusive authority concerning the impacts of projects constructed within US territory on foreign territoriesThe Act makes permanent certain provisions that were included as temporary provisions in the Tax Increase Prevention and Reconciliation Act of 2005 and were otherwise scheduled to expire after 2010, including: Federal income tax exemption of certain qualified settlement funds established to resolve CERCLA claims "Separate affiliated group" rule for satisfaction of active trade or business requirement under Section 355 Election to treat self-created musical works as capital assets Exemption from imputed interest rules for certain loans to qualified continuing care facilities CRS Report in the public domain H.
R. 6111, Legislative History
American Recovery and Reinvestment Act of 2009
The American Recovery and Reinvestment Act of 2009, nicknamed the Recovery Act, was a stimulus package enacted by the 111th U. S. Congress and signed into law by President Barack Obama in February 2009. Developed in response to the Great Recession, the ARRA's primary objective was to save existing jobs and create new ones as soon as possible. Other objectives were to provide temporary relief programs for those most affected by the recession and invest in infrastructure, education and renewable energy; the approximate cost of the economic stimulus package was estimated to be $787 billion at the time of passage revised to $831 billion between 2009 and 2019. The ARRA's rationale was based on the Keynesian economic theory that, during recessions, the government should offset the decrease in private spending with an increase in public spending in order to save jobs and stop further economic deterioration. Since its inception, the impact of the stimulus has been a subject of disagreement. Studies on its effects have produced a range of conclusions, from positive to negative and all reactions in between.
In 2012, the IGM Forum poll conducted by the University of Chicago Booth School of Business found 80% of leading economists agree unemployment was lower at the end of 2010 than it would have been without the stimulus. 46% "agreed" or "strongly agreed" that the benefits outweighed the costs, 27% were uncertain, 12% disagreed or disagreed. IGM Forum asked the same question to leading economists in 2014; this new poll found 82% of leading economists agreed or agreed that unemployment was lower in 2010 than it would have been without the stimulus. Revisiting the question about the benefits outweighing the costs, 56% agreed or agreed that it did, 23% were uncertain, 5% disagreed. Both the House and the Senate versions of the bills were written by Democratic Congressional committee leaders and their staffs; because work on the bills started before President Obama took office on January 20, 2009, top aides to President-Elect Obama held multiple meetings with committee leaders and staffers. On January 10, 2009, President-Elect Obama's administration released a report that provided a preliminary analysis of the impact to jobs of some of the prototypical recovery packages that were being considered.
The House version of the bill, H. R. 1, was introduced on January 26, 2009. It was sponsored by Democrat David Obey, the House Appropriations Committee chairman, was co-sponsored by nine other Democrats. On January 23, Speaker of the House Nancy Pelosi said that the bill was on track to be presented to President Obama for him to sign into law before February 16, 2009. Although 206 amendments were scheduled for floor votes, they were combined into only 11, which enabled quicker passage of the bill. On January 28, 2009, the House passed the bill by a 244–188 vote. All but 11 Democrats voted for the bill, 177 Republicans voted against it; the senate version of the bill, S. 1, was introduced on January 6, 2009, substituted as an amendment to the House bill, S. Amdt. 570. It was sponsored by Harry Reid, the Majority Leader, co-sponsored by 16 other Democrats and Joe Lieberman, an independent who caucused with the Democrats; the Senate began consideration of the bill starting with the $275 billion tax provisions in the week of February 2, 2009.
A significant difference between the House version and the Senate version was the inclusion of a one-year extension of revisions to the alternative minimum tax, which added $70 billion to the bill's total. Republicans proposed several amendments to the bill directed at increasing the share of tax cuts and downsizing spending as well as decreasing the overall price. President Obama and Senate Democrats hinted that they would be willing to compromise on Republican suggestions to increase infrastructure spending and to double the housing tax credit proposed from $7,500 to $15,000 and expand its application to all home buyers, not just first-time buyers. Other considered amendments included the Freedom Act of 2009, an amendment proposed by Senate Finance Committee members Maria Cantwell and Orrin Hatch to include tax incentives for plug-in electric vehicles; the Senate called a special Saturday debate session for February 7 at the urging of President Obama. The Senate voted, 61–36 on February 9 to end debate on the bill and advance it to the Senate floor to vote on the bill itself.
On February 10, the Senate voted 61–37 All the Democrats voted in favor, but only three Republicans voted in favor. Specter switched to the Democratic Party in the year. At one point, the Senate bill stood at $838 billion. Senate Republicans forced a near unprecedented level of changes in the House bill, which had more followed the Obama plan. A comparison of the $827 billion economic recovery plan drafted by Senate Democrats with an $820 billion version passed by the House and the final $787 billion conference version shows huge shifts within these similar totals. Additional debt costs would add about $350 billion or more over 10 years. Many provisions were set to expire in two years; the main funding differences between the Senate bill and the House bill were: More funds for health care in the Senate, renewable energy programs, for home buyers tax credit, new payments to the elderly and a one-year increase in AMT limits. The House had more funds appropriated for education and for aid to low income workers and the unemployed.
Aid to low income worke