National Debt Relief Program

The US congress signed a 787 billion dollar impetus to cushion the US economy, the amount is earmarked to be spent over a period of ten years. Most of the money will be invested in the first three years in the form of tax credits, grants, loans, and contracts. The Obama government has devised this national debt relief program on the lines of the Keynesian economics formula which calls for more government spending.

The economic recession has left many companies on the verge of bankruptcy due to a lack of consumer spending. A vast majority of the US population finds itself under credit card debt or some form of financial crisis brought on by the fluctuating economy. People are losing their homes and everyday more and more homeowners are facing the risk of foreclosure. All this led to the signing of the American Recovery and Reinvestment Act 2009 (ARRA) which made sweeping reform in the federal tax tables. The US congress also signed the Credit Card Accountability Responsibility and Disclosure act 2009 which ushered in an era of much-needed reforms in the credit card industry.

National Debt Initiative Program

The American Recovery and Reinvestment Act 2009 (ARRA) popularly came to be known as the national debt relief stimulus plan because analysts saw it as a measure that would help get the population out of debt. Similarly, the Credit Card Accountability Responsibility and Disclosure Act 2009 is known as the Credit Card Reform Act of 2009 because it made amends to the way credit card companies did business.

Tax Reforms
Under the ARRA the government made tax reforms that allowed the average American to take home larger pay checks as part of the national debt relief program. It also entitled many Homeowners to restructure their home loans and many got tax credit for the vehicles they brought in the year 2009.

Homeowners: One of the tax reforms allowed people to claim a tax refund of up to USD 8,000 on their tax returns. People who entered into a binding contract to buy a home on or before April 30 2010 are eligible for this tax benefit. This tax benefit is an Obama debt relief initiative that was welcomed by many homeowners.

Health Insurance: The government initiated the Health Coverage Tax Credit (HCTC) as a part of the national debt consolidation program which pays 80 percent of health insurance premiums of eligible candidates. People in the age group of 55 to 65 qualify if they are enrolled in a qualified health plan and receive pension from the pension benefit guarantee corporation.

Making Work Pay: Changes were made in the federal income tax withholding tables which allowed workers, a making work pay tax credit of up to USD 400 for individuals and up to USD 800 for married couples. Pensioners do not qualify for this tax benefit unless they have earned income but self employed individuals can benefit from this tax credit devised under the national debt relief plan.

Vehicle Owners: People who brought new cars in the year 2009 can get tax credit for vehicles they bought for up to USD 49,500. Eligible people can deduct the local and state sales tax they paid or fees they paid for states with no sales tax. For joint filers the deduction is reduced with Modified Adjusted Gross Income (MAGI) between USD 250,000 to USD 260,000 and for others with MAGI between USD 125,000 to USD 135,000.

Credit Card Reforms
Mounting credit card debt of the population spurred the government to come up with reforms to the credit card industry. Credit card companies are required to have the card contracts online for government scrutiny. The companies will also have to send the credit statements to the customers 21 days in advance earlier it was 14 days.

Credit card companies are also not allowed to make any changes to the interest rates without giving at least 45 days notice to the customers as part of the national debt settlement program. The credit card reform act also stipulates that the card companies have to give their customers up to 3 billing cycles after any interest rate increase to say no to the new terms.

Other reforms under the national debt relief stimulus program prohibit card companies from charging interest on debt paid on time during the grace period. It also restricts charging fees on interest only balance of cardholders who have made on time payments. The reform act also stipulates the font size to be used for the contract and also prevents the companies from using misleading terms.

The national debt relief program has also allocated funds in the form of government stimulus grants for education and small businesses geared towards helping the community. New infrastructure contracts were also given out to help create new jobs. Industries facing bankruptcy were also given tax credits so that people working in them would be able to retain their jobs.