It permanently repeals the requirement that seniors begin withdrawing IRA funds at age 70 1/2 and suspends taxes and penalties for all of 2009 for any IRA withdrawals. This last measure will allow hard-pressed families immediate access to savings, helping prevent foreclosures or bankruptcy.

Our proposal will prohibit tax rates on capital gains or dividends from increasing in 2010, as they are currently set to, leaving more dollars in the hands of investors.

As unemployment rises, businesses need incentives to expand and hire. The RSC stimulus plan will reduce America’s corporate income tax rate (currently the second highest in the world) from 35 percent to 25 percent, cut the capital gains rate for corporations from 35 percent to 15 percent and index capital gains taxes to offset inflation. These three provisions will allow businesses to forestall layoffs and increase hiring.

We will also encourage growth and entrepreneurship by repealing limits on expensing allowances for depreciable business assets, making the research and development tax credit permanent (they are currently set to expire with the Bush tax cuts) and extending the current two-year carryback period for net operating losses to seven years.

Finally, our plan will impose a one percent across the board reduction in non-defense discretionary federal spending. The RSC sees that as a down payment on future efforts to curb the ravenous spending that plagues the federal government. Unrestrained spending helped create our current economic crisis. We cannot cure it, or avoid future meltdowns, by following the same flawed path.

The Republican Study Committee will continue to press for tax relief and spending restraint as core elements of any economic recovery plan. President-elect Obama has pledged to listen to our ideas. Moving forward, we will hold him to that promise.