FACTBOX - Revised financial bailout bill

Tue Oct 7, 2008 12:48pm BST
 
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WASHINGTON (Reuters) - The House of Representatives was poised to vote on a $700 billion bailout package for U.S. banks, under pressure from all sides as the effort to head off a spreading financial crisis hung in the balance.

Following is a rundown of the changes to the original bill, along with some of the options that the Treasury, Federal Reserve and other agencies could employ to calm markets if the plan is rejected a second time.

REVISIONS TO THE $700 BILLION ASSET RESCUE PLAN

* The bill would raise the Federal Deposit Insurance Corp's current insurance limit to $250,000 per account from $100,000. The FDIC also would receive temporary unlimited borrowing authority from the Treasury under the bill. The measure is intended to boost banking system confidence and could be well-received in wealthier Republican congressional districts.

* Some 24 million middle-class taxpayers would get relief from a one-year fix that shields them from higher tax rates under the Alternative Minimum Tax. The issue comes up every year and temporary fixes routinely win broad support in Congress.

* It extends tax deductions for state and local sales taxes and allows deductions for state and local property taxes and higher education expenses for taxpayers who do not itemize their tax returns.

* The bill includes $18 billion in tax breaks for clean and renewable energy by continuing production tax credits for wind and refined coal, as well as breaks for solar and plug-in electric vehicles.

* The bill includes extension of favourable business tax provisions, such as tax credits related to new markets and research and development as well as the tax treatment of costs for retail and restaurant improvements.

* The bill would require insurance plans that offer mental health benefits to offer them at the same level as medical-surgical benefits.  Continued...

 
A dealer works on the trading floor shortly after the U.S. markets opened, at CMC Markets in London October 3, 2008. REUTERS/Toby Melville
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