John A. Kennedy, Jr., LLC

Certified Public Accountant

The Jobs and Growth Tax Relief Reconciliation Act of 2003

Overall Reduced capital gains/dividends rates Accelerated marginal rate cuts Enhanced small business assets expensing/extended bonus depreciation Increased child tax credit AMT relief Marriage penalty relief Expanded 10% bracket Much relief retroactive Articles Advance child tax credit payments SUV tax break

Average Tax Savings $30,000 INCOME Single, $50 Single parent with one child, $400 Married couple with two children, $955 $50,000 INCOME Single, $326 Single parent with one child, $400 Married couple with two children, $1,133 $70,000 INCOME Single, $826 Single parent with one child, $877 Married couple with two children, $2,021

Corporate dividends, capital gains: $148 billion.

• Would lower the top rate to 15 percent on taxes paid by stockholders on corporate dividends (from ordinary income rates- 28%, etc.) and the taxes on capital gains (from 20%). Lower income earners would pay a 5 percent rate on both.
• The new rates would run through 2007. (In 2008, the lower rate would drop to zero. In 2009, taxes on dividends return to rates paid on ordinary income, taxes on capital gains return to a top rate of 20 percent.)

• Accelerated marginal rate cuts- Would accelerate several tax reductions that had been scheduled to occur later this decade. Highest income tax brackets would be reduced, reaching back to Jan. 1, from 38.6 percent to 35 percent, from 35 percent to 33 percent, from 30 percent to 28 percent and from 27 percent to 25 percent. The lowest, 10 percent bracket would be expanded in 2003 and 2004.  
• The child credit would be increased to $1,000 per child from the current $600, in 2003 and 2004.
• For married people filing joint returns, the 15 percent bracket would be expanded and the standard deduction increased in 2004 and 2005. Would prevent more taxpayers from paying alternative minimum tax in 2003 and 2004.
• AMT relief- The exemption for single taxpayers rises to $40,250 (up from $35,750) and the exemption for married couples rises to $58,000 (up from $49,000), but only for tax years 2003 and 2004.