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Angie Drobnic Holan
By Angie Drobnic Holan February 19, 2009

Obama signs stimulus, extending unemployment

The American Recovery and Reinvestment Act of 2009, which President Obama signed on Feb. 17, 2009, contains a major extension of unemployment benefits.

States administer unemployment based on federal guidelines, so how much a person gets and how long he or she receives benefits varies by state. Usually, people receive a set amount of money each week for about six months.

When the economy deteriorated in 2008, Congress extended benefits, giving more money and setting longer time frames for the states with the highest unemployment numbers. The economic recovery bill that Obama signed extended those time periods again. Depending on circumstances, most people receiving benefits should get an extension, with the hardest hit states winning extended benefits through Dec. 31, 2009.

Unemployment benefits are normally taxed as regular income, but the bill exempted the first $2,400 of unemployment from 2009 income taxes.

Obama pledged to extend unemployment benefits and temporarily suspend taxes on the benefits. He definitely achieved the first part, and taxes are suspended on some of those benefits. So we are rating this one Promise Kept.

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Angie Drobnic Holan
By Angie Drobnic Holan January 18, 2009

Extensions in stimulus bill

The House of Representatives Appropriations Committee released its plans for a major stimulus bill on Jan. 19, 2009, and they included a sizable extension of unemployment benefits. The plan would send $27 billion to the program, which gives weekly cash payments to laid-off workers. That money should cover up to 33 weeks of payments through 2009, according to the report.

But the House Ways and Means Committee, which released the tax portion of the stimulus plan, does not include a provision to make those benefits tax-free.

If the benefits get extended but are still taxed, this promise might be headed toward a rating of Compromise. Meanwhile, it's enough progress that we rate it In the Works.

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