In the lead-up to Wednesday’s State of the Union Address, President Obama released a series of recommendations today to expand child care, dependent care, and retirement savings tax credits for middle class Americans. In these proposals, which will be part of the administration's 2011 budget, Obama calls on Congress to almost double the child care tax credit for families earning less than $85,000 per year — a move that could save families in this income bracket $900 in taxes per year, according to a New York Times story by Sheryl Gay Stolberg. Stolberg writes that "one advantage of the president’s proposals is that they might appeal to people who are struggling financially without looking like the kind of broad expansion of the federal government that is making many Americans uneasy." Families earning under $115,000 a year will also be eligible for a tax credit increase, the White House statement said. The proposals also call for bigger tax credits to match retirement savings and support for families caring for elderly relatives.
Though the president is expected to speak about the deficit in his Wednesday Address, it is uncertain how much these programs will add to it, a Wall Street Journal story reports.
Also today in taxation news:
U.S. Home Sales Tumble (Reuters)
In Washington, a Lesson in Bureaucracy Comes in Every Bag