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What the new tax cuts mean to you

This week Congress gave President Bush his fourth tax cut in four years. The $145.9-billion package was approved in the House 339-65. In the Senate, the measure passed 92-3. The tax cut package will affect nearly 94-million Americans, mainly through its provision to extend a broader 10 percent tax bracket, which helps reduce taxes for virtually all taxpayers. The package also keeps the per child tax credit at $1,000 and retains the provisions providing married couples relief from the so-called marriage penalty. The package extends the child credit for five years, teh marriage penalty relief for four years and the expanded 10 percent tax bracket for six years. All were to expire Jan. 1. Here's a look at the package's impact on 2005 taxes, as prepared by CCH Inc., a provider of tax and business law information and software:

Married filing jointly tax brackets

2005 with new law:

2005 taxable income Tax rate

$0 - 14,600 10%

$14,601 - 59,400 15%

$59,401 - 119,950 25%

$119,951 - 182,800 28%

$182,801 - 326,450 33%

Over $326,450 35%

2005 without new law:

2005 taxable income Tax rate

$0 - 12,000 10%

$12,001 - 53,450 15%

$53,451 - 119,950 25%

$119,951 - 182,800 28%

$182,801 - 326,450 33%

Over $326,450 35%

Fourth tax cut

Being extended Cost in billions

$1,000 child tax credit, through 2009 $61.6

Expanded 10 percent tax bracket, through 2010 $29.4

Alternative minimum-tax relief for one year $22.6

Marriage penalty relief, through 2008 $15.7

23 business tax credits for one year $13.0

Note: The $145.9-billion includes refundability of child credit accelerated to 2004 and inclusion of combat pay in earned income for purposes of child tax credit. New York Liberty Zone bond provisions are through 2009.

Standard deductions:

Married filing jointly:

2005 with new law: $10,000

2005 without new law: $8,700

Married filing separately:

2005 with new law: $5,000

2005 without new law: $4,350

Filing single:

2005 with new law: $5,000

2005 without new law: $5,000

Head of household:

2005 with new law: $7,300

2005 without new law: $7,300

Child tax credit, per qualifying child:

2005 with new law: $1,000

2005 without new law: $700

Source: CCH Inc., Joint Committee on Taxation, AP and Washington Post

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