April 15th, the deadline for filing personal income taxes, is the most dreaded day of the year for many Americans. With the typical family sending more to Uncle Sam than they spend on food, clothing and shelter combined, not looking forward to April 15th is understandable.
Fortunately, Americans are getting some much needed tax relief this year. Last year, Congress passed and President Bush signed into law the most substantial tax relief legislation in a generation. The legislation cuts marginal tax rates, reduces the marriage penalty, ends the death tax and doubles the child tax credit.
Importantly, this legislation was also responsible for the checks of up to $600 that those who pay federal income taxes received in the mail last year. More than 1,760,000 Tennesseans received checks totaling $755 million. Thanks to the checks and other tax relief measures, the economy was stimulated, lessening the length and depth of the economic slowdown we entered in 2000.
Much of the $1.3 trillion tax relief bill is phased in over 10 years. Ideally, I would have liked for the tax relief to have been phased in faster, but the realities of politics in Washington prohibited it. Even so, as people total their tax bills in time for April 15th, many are already seeing a decrease in their tax liabilities.
Between 2001 and 2011, Tennesseans will see a substantial decrease in what they owe Uncle Sam. Residents of the Volunteer State will pay $18.5 billion less thanks to marginal rate reductions and the elimination of the death tax. Thanks to the doubling of the child tax credit, Tennesseans with dependent children will see an additional $3.3 billion in savings. Married couples will be saved another $1.3 billion as a result of the reductions in the marriage penalty.
Over ten years, the tax relief bill will amount to roughly $23 billion staying with Tennessee families instead of being sent to Washington. It is a substantial amount, most of which will be spent in Tennessee, creating new jobs and more opportunities for the people of our state.
Last year, the typical American worked until May 3rd, 123 days into the year, just to make enough money to pay his or her taxes. I believe that is far too long. I am proud we were able to pass tax relief legislation that will mean American families keep more of what they earn. Each family has its own unique needs. Helping them have the extra money in their budgets to meet those needs was one of Congresses' biggest legislative accomplishments last year. I am pleased many will see the fruits of that accomplishment on April 15th.