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The Inflation Reduction Act Details and Fact Sheets

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The Inflation Reduction Act Details and Fact Sheets
The Inflation Reduction Act Details and Fact Sheets

Washington, D.C. – August 24, 2022 – White House Release – followup to President Biden Signs Inflation Reduction Act of 2022 HR 5376

The Inflation Reduction Act will lower costs for families, combat the climate crisis, reduce the deficit, and finally ask the largest corporations to pay their fair share. President Biden and Congressional Democrats have worked together to deliver a historic legislative achievement that defeats special interests, delivers for American families, and grows the economy from the bottom up and middle out.

Here’s how the Inflation Reduction Act impacts Americans by the numbers:

HEALTH CARE

Cutting Prescription Drug Cost

  • Today, Americans pay two to three times what citizens of other countries pay for prescription drugs
  • 5-7 million Medicare beneficiaries could see their prescription drug costs go down because of the provision allowing Medicare to negotiate prescription drug costs.
  • 50 million Americans with Medicare Part D will have the peace of mind knowing their costs at the pharmacy are capped at $2,000 per year, directly benefiting about 1.4 million beneficiaries each year.
  • 3.3 million Medicare beneficiaries with diabetes will benefit from a guarantee that their insulin costs are capped at $35 for a month’s supply.

Lowering Health Care Costs

  • 13 million Americans will continue to save an average of $800 per year on health insurance premiums
  • 3 million more Americans will have health insurance than without the law.
  • The uninsured rate is at an all-time low of 8%, which the historic law will build on.

Defeating Special Interests

  • $187 million: The amount the Pharmaceutical industry has spent on lobbying in 2022.
  • 1,600: number of lobbyists the pharmaceutical companies had in 2021 – three times the number of Members of Congress
  • 33 years: the amount of time Congressional Democrats have been trying to lower prescription drug costs by allowing Medicare to negotiate drug prices.
  • 19 years: number of years Medicare has been blocked from negotiating prescription drug costs

CLEAN ENERGY

Lowering Energy Costs

  • Families that take advantage of clean energy and electric vehicle tax credits will save more than $1,000 per year.
  • $14,000 in direct consumer rebates for families to buy heat pumps or other energy efficient home appliances, saving families at least $350 per year.
  • 7.5 million more families will be able install solar on their roofs with a 30% tax credit, saving families $9,000 over the life of the system or at least $300 per year.
  • Up to $7,500 in tax credits for new electric vehicles and $4,000 for used electric vehicles, helping families save $950 per year.
  • Putting America on track to meet President Biden’s climate goals, which will save every family an average of $500 per year on their energy costs.

Building a Clean Energy Economy

  • Power homes, businesses, and communities with much more clean energy by 2030, including:
    • 950 million solar panels
    • 120,000 wind turbines
    • 2,300 grid-scale battery plants
  • Advance cost-saving clean energy projects at rural electric cooperatives serving 42 million people.
  • Strengthen climate resilience and protect nearly 2 million acres of national forests.
  • Creating millions of good-paying jobs making clean energy in America.

Reducing Harmful Pollution

  • Reduce greenhouse gas emissions by about 1 gigaton in 2030, or a billion metric tons – 10 times more climate impact than any other single piece of legislation ever enacted.
  • Deploy clean energy and reduce particle pollution from fossil fuels to avoid up to 3,900 premature deaths and up to 100,000 asthma attacks annually by 2030.

TAXES

Making the Tax Code Fairer

  • $0: how much some of largest, profitable corporations pay in federal income tax.
  • 55: the number of America’s largest, wealthiest corporations that got away without paying a cent in federal income taxes in 2020.
  • $160 billon: how much the top 1 percent of earners is estimated to evade each year in taxes.
  • 15%: the minimum tax on corporate profits the Inflation Reduction Act imposes on the largest, most profitable corporations.
  • $124 billion: savings over 10 years the Inflation Reduction Act will generate from collecting taxes already owed by wealthy people and large corporations, according to the Congressional Budget Office.
  • And no family making less than $400,000 will see their taxes go up a penny.

Reducing the Deficit

  • The Inflation Act will achieve hundreds of billions in deficit reduction.
  • The deficit is projected to fall by more than $1.5 trillion this year after falling by more than $350 billion last year.
  • 126 leading economists – including 7 Nobel Laureates, 2 former Treasury Secretaries, 2 former Fed Vice Chairs and 2 former CEA Chairs – have said reducing the deficit will help fight inflation and support strong, stable economic growth.

By signing the Inflation Reduction Act, President Biden is delivering on his promise to meet the climate crisis and build an economy that works for working families. The Inflation Reduction Act makes historic investments in America’s future while lowering health care and energy costs. It’s the most aggressive action we have taken to confront the climate crisis. It’ll lower the deficit and ask the super wealthy and corporations to pay their fair share. And no one making under $400,000 per year will pay a penny more in taxes.

President Biden and Congressional Democrats beat back the special interests to pass this historic legislation that builds a brighter future for young Americans by lowering costs, advancing environmental justice while building a cleaner future, and growing the economy from the bottom up and the middle out.

TACKLE THE CLIMATE CRISIS

This lawrepresents the single most aggressive action the U.S. is taking to tackle the climate crisis and create clean energy solutions in American history. The law will bring down energy costs for families and create thousands of good jobs, all while reducing climate pollution and ensuring that we have a clean, secure future energy supply. It will:

Reduce Pollution: The law would reduce about a gigaton (a billion metric tons) of greenhouse gas emissions in 2030 and position America to meet President Biden’s climate goals of cutting climate pollution in half by 2030 and reaching net-zero emissions by no later than 2050.

Advance Environmental Justice: Climate change disproportionately impacts low-income communities and communities of color. The Act will work to alleviate legacy pollution and to ensure that clean energy opportunities reach all Americans through:

  • Creating new Environmental Justice Block Grants—which will support community-led projects across the country, including tackling pollution in port communities where air pollution is especially deadly.
  • Creating a new Clean Energy and Sustainability Accelerator that will seed state and local clean energy financing banks, which will help disadvantaged communities access the benefits of the law.
  • Providing funding for Tribal communities to bring clean, zero-emissions power to homes and to boost their climate resilience.

Cut Energy Costs: The law makes it more affordable to purchase energy efficient and electric appliances, home improvements, and more to bring down energy costs. Overall, the law puts America on track to meet the President’s climate goals, which will save every family an average of $500 per year on their energy bills, providing support for:

  • Efficient Appliances and Home Upgrades – The law includes direct consumer rebates when households need to upgrade furnaces, water heaters, stoves, ovens, or other home appliances with more energy efficient and electric appliances. Households can save up to 30% with tax credits for home construction projects on windows, doors, insulation, or other weatherization measures that prevent energy from escaping homes. These upgrades can lower future utility bills by at least $350 per year.
  • Home Energy Systems – When households want to install solar on their roof they can save up to 30% with tax credits. For example, average family installing solar using this credit would save $9,000 on their electricity bill over the life of the system, or about $300 per year.
  • Cleaner Cars and Trucks – The law will bring down the sticker price of electric vehicles, providing Americans tax credits of up to $7,500 for new and $4,000 for used electric vehicle purchases. This measure could especially help young Americans buy their first car and skip the gas pump forever.

LOWER HEALTH CARE COSTS

Since 2014, the Affordable Care Act (ACA) has helped provide quality health insurance coverage for people who don’t receive coverage through their jobs. Still, health insurance remains unaffordable for many Americans. During his campaign, President Biden promised to build on the ACA by making premium tax credits more generous and lowering health care premiums for working families. The President’s American Rescue Plan kept that commitment by improving premium tax credits. However, those improvements are set to expire at the end of 2022. The Inflation Reduction Act extends them through 2025:

  • Saving 13 Million Americans Hundreds of Dollars per Year. About 13 million Americans will save an average of about $800 annually on health insurance premiums. Young people will also benefit significantly, as more than 3.5 million people ages 18-34 are on marketplace health care plans.
  • About 3 million more people will have coverage next year with this extension. Although the uninsured rate fell to the lowest level in U.S. history in early 2022, young people ages 18-24 continue to be the most likely to be uninsured.
  • By increasing access to coverage, the law will improve health outcomes; improve financial security by reducing medical debt and rent and mortgage delinquencies; and narrow racial disparities in health coverage and care access.

MAKE THE TAX CODE FAIRER

President Trump and Congressional Republicans’ 2017 tax law only made an unfair tax system worse. The Inflation Reduction Act of 2022 is a critical step forward in making our tax code fairer. It will raise revenue by:

  • Ensuring that high-income people and large corporations pay the taxes they already owe.
  • Cracking down on large, profitable corporations that currently get away with paying no federal income tax.
  • Imposing a 1% surcharge on corporate stock buybacks that will encourage businesses to invest.

The legislation’s tax reforms won’t just raise revenue to finance critically needed investments to lower costs and combat climate change, they are also an important component of building an economy that rewards work rather than wealth and doesn’t let the rich and powerful get away with playing by a separate set of rules.  Millions of working families will have better access to the benefits they are entitled to under the tax code and be able to get their questions answered quickly and efficiently, thanks to the law’s transformational investments in the Internal Revenue Service. And, no family making less than $400,000 per year will see their taxes go up by a single cent.

By signing the Inflation Reduction Act, President Biden is delivering on his promise to build an economy that works for working families, including rural families. The Inflation Reduction Act makes historic investments in America’s future while lowering health care and energy costs. It’s the most aggressive action we have taken to confront the climate crisis. It’ll lower the deficit and ask the super wealthy and corporations to pay their fair share. And no one making under $400,000 per year will pay a penny more in taxes.

President Biden and Congressional Democrats beat back the special interests to pass this historic legislation that will build a brighter future for rural Americans by lowering costs, invests in rural communities to expand access to affordable clean energy and energy efficient upgrades, and grows the economy from the bottom up and the middle out.

LOWER HEALTH CARE COSTS
The Inflation Reduction Act (IRA) will build on the success of the Affordable Care Act (ACA) and the American Rescue Plan (ARP) by helping to lower health care costs, including prescription drug costs, and expanding coverage for millions of Americans.

Lower Prescription Drug Costs for Seniors: Because seniors disproportionately choose to live in rural America, rural Americans stand to disproportionately benefit from the Inflation Reduction Act as it lowers prescription drug costs for seniors on Medicare. Today, Americans pay 2-3 times more for their prescription drugs than people in other wealthy countries. The Inflation Reduction Act increases access to medication in rural areas by improving prescription drug coverage and lowering drug prices in Medicare. The law:

  • Caps the amount that seniors will have to pay for prescription drugs they buy at the pharmacy at $2,000 a year, giving peace of mind to seniors who no longer have to worry about spending thousands and thousands more on prescription drugs.
  • Caps the amount that seniors will have to pay for insulin at $35 for a month’s supply.
  • Means that seniors on Medicare will now have access to a number of additional free vaccines, including the shingles vaccine.
  • Will further lower prescription drug costs for seniors by allowing Medicare to negotiate the price of high-cost drugs and requiring drug manufacturers to pay Medicare a rebate when they raise prices faster than inflation.

Lower Health Insurance Premiums and Expand Coverage: Since the implementation of the ACA’s coverage expansions, the uninsured rate among rural Americans decreased by 8%, from about 24 percent in 2010 to 16 percent in 2019. The Inflation Reduction Act continues the American Rescue Plan’s more generous Affordable Care Act premium tax credits

  • Thanks to the American Rescue Plan, 65 percent (1.3 million) of the 1.9 million rural uninsured Americans in states using the HealthCare.gov had access to a $0-premium health insurance plan for 2021. The Inflation Reduction Act will help keep free or low-cost health insurance available to rural Americans, with average savings of about $800 per person per year. As a result, about 3 million more Americans will have health insurance coverage next year, compared to without the IRA.

COMBAT CLIMATE CHANGE AND LOWER ENERGY COSTS
This Inflation Reduction Act represents the single largest investment in climate and clean energy solutions in American history. The law invests in rural communities to expand access to affordable clean energy and energy efficiency upgrades, create good-paying jobs through climate-smart agriculture and conservation, and protect communities from intensifying climate impacts like wildfires and extreme heat. Because of this legislation, farmers, ranchers, and foresters will have the tools they need to adopt practices that recognize the valuable role our lands provide in tackling the climate crisis.

Clean Energy and Energy Efficiency: The Inflation Reduction Act boosts the long-term resiliency, reliability, and affordability of rural electric systems, helps families save money on utility bills, and expands rural opportunities in the clean energy economy. It provides:

  • Rural electric cooperatives, which serve 42 million customers, resources to advance clean energy projects, energy efficiency improvements, zero-emission systems, and more. And for the first time, these co-ops will now be eligible for direct-pay clean energy tax credits.
  • An expansion of USDA’s Rural Energy for America Program to support clean energy and energy efficiency projects for more than 41,500 farms and small businesses.
  • Investments to advance biofuel infrastructure to help 4,600 retailers boost domestic supplies of clean fuels.

Support for Farmers, Ranchers, and Forest Landowners: The Inflation Reduction Act recognizes the critical role that America’s farmers, ranchers, and forest landowners play in addressing the climate crisis. The law will:

  • Invest in helping farmers, ranchers, and forest landowners deploy climate-smart practices that will reduce greenhouse gas emissions, increase storage of carbon in soils and trees, and make their operations more productive.
  • Support innovative, cost-effective ways to measure and verify climate benefits, including through USDA’s Environmental Quality Incentives Program, Conservation Stewardship Program, Agricultural Conservation Easement Program, Regional Conservation Partnership Program, and Conservation Technical Assistance.
  • Help up to 280,000 farmers and ranchers apply conservation to approximately 125 million acres of land.

Strengthening the Resilience of Rural Lands to Climate Impacts: The Inflation Reduction Act protects communities from the risks of wildfires and make public and private lands more resilient in the face of climate change. These investments will help:

  • Protect 1.8 million acres of National Forest System Lands from wildfire and restore an additional 550,000 acres of federal lands.
  • Increase climate resilience of forests on 280,000 acres of non-federal land, support conservation easements on 475,000 private acres, and prepare management plans for an additional 1,500,000 private acres.
  • Strengthen habitats and infrastructure to withstand climate-induced extreme weather events in our National Parks, National Wildlife Refuges and across our public lands.
  • Address the long-term drought conditions that are afflicting large swaths of rural America.

Supporting Energy Producing Communities: The Inflation Reduction Act invests in revitalizing economies of energy communities across the country, by create good-paying, union jobs, and supporting workers in coal, oil and gas, and power plant industries by:

  • Reinstating funding for the Black Lung Disability Trust Fund, which provides payments and medical treatment to coal miners suffering from breathing and respiratory challenges.
  • Authorizes $250 billion in loans through the Department of Energy’s Loan Programs Office to retool legacy energy infrastructure like transmission lines, refineries and power plants for the net-zero economy.
  • Provides a 10% bonus tax credit for wind and solar projects that are developed in places that have seen a coal mine or power plant close or have seen employment losses as a result of contractions in the fossil fuel economy.
  • Delivers tax credits for clean energy manufacturing projects that are developed in energy communities where coal mines and power plants have closed with bonus credit for projects creating good-paying union jobs.

SUPPORT FARMERS AND RANCHERS
We need every farmer to contribute to reducing food inflation and feeding the nation and the world. The Inflation Reduction Act will help keep distressed farmers farming and provide assistance to farmers who have experienced discrimination in USDA’s leading programs. The law includes:

  • Relief for distressed USDA borrowers whose agricultural operations are at risk through loan modifications or payments.
  • Financial assistance to farmers who have experienced past discrimination in USDA lending programs.

MAKE THE TAX CODE FAIRER
President Trump and Congressional Republicans’ 2017 tax law only made an unfair tax system worse. The Inflation Reduction Act of 2022 is a critical step forward in making our tax code fairer. It will raise revenue by:

  • Ensuring that high-income people and large corporations pay the taxes they already owe.
  • Cracking down on large, profitable corporations that currently get away with paying no federal income tax.
  • Imposing a 1% surcharge on corporate stock buybacks that will encourage businesses to invest.

The legislation’s tax reforms won’t just raise revenue to finance critically needed investments to lower costs and combat climate change, they are also an important component of building an economy that rewards work rather than wealth and doesn’t let the rich and powerful get away with playing by a separate set of rules.

Millions of working families will have better access to the benefits they are entitled to under the tax code and be able to get their questions answered quickly and efficiently, thanks to the Act’s transformational investments in the Internal Revenue Service. And, no family making less than $400,000 per year will see their taxes go up by a single cent.

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The Inflation Reduction Act Delivers Affordable Clean Energy for Michigan
The Inflation Reduction Act is the most significant legislation in U.S. history to tackle the climate crisis and strengthen American energy security. It will lower energy costs for households and
businesses, create manufacturing jobs for American workers, and deliver a clean, secure, and healthy future for our children and grandchildren. The savings, jobs, and other benefits provided
by this legislation will reach communities across Michigan.
President Biden promised to combat the existential threat of climate change and build a clean energy future that creates jobs, advances environmental justice, and lowers costs for families.
He’s following through on that promise with the Inflation Reduction Act and Bipartisan Infrastructure Law.

• LOWER ENERGY COSTS: The Inflation Reduction Act will make it more affordable for Michigan families to purchase energy efficient appliances when they need to, make repairs around their homes, and save money on their utility bills each month, through:
o Rebates covering 50-100% of the cost of installing new electric appliances, including super-efficient heat pumps, water heaters, clothes dryers, stoves, and ovens. In Michigan, millions of low- and moderate-income households are eligible for rebates.
o Rebates for households to make repairs and improvements in single-family and multi-family homes to increase energy efficiency.
o Tax credits covering 30% of the costs to install solar panels and battery storage systems, make home improvements that reduce energy leakage, or upgrade heating and cooling equipment. No income limits apply. For solar, uptake projections estimate that over 160,000 additional Michigan households will install
rooftop panels as a result.
o Tax credits covering 30% of the costs of community solar projects—owned by local businesses that sign up families to save on their electric bills—with additional bonus credits of 20% for projects at affordable housing properties and 10% for projects in
low-income communities.
o Grants to help state and local governments adopt the latest building energy codes, which would save the average new homeowner in Michigan 10.7% on their utility
bills—$337 annually.
• GOOD-PAYING JOBS: In 2021, there were already 119,853 Michigan workers employed in clean energy jobs. The Inflation Reduction Act will expand these opportunities, bringing an estimated $8.3 billion of investment in large-scale clean power generation and storage to Michigan between now and 2030. It provides a historic set of tax credits that will create jobs across solar, wind, storage, and other clean energy industries. These credits includebonuses for businesses that pay a prevailing wage, so that Michigan workers earn a good paycheck as we build the clean energy future in America.
• DOMESTIC MANUFACTURING: Manufacturers employ 583,700 workers in Michigan, and the Inflation Reduction Act will help us make the technologies of the future at home—supporting local economies and strengthening supply chains. The Inflation Reduction Act will boost U.S. manufacturing of clean energy and transportation technologies, as well as investments for a new Advanced Industrial Facilities Deployment Program to position
America to lead the growing global market for clean steel, aluminum, cement, and more.
• SMALL BUSINESSES: Michigan is home to 902,131 small businesses, representing 99.6% of all businesses in the state, and the Inflation Reduction Act will help them save money. Commercial building owners can receive a tax credit up to $5 per square foot to support energy efficiency improvements that deliver lower utility bills. Other programs that will benefit small businesses include tax credits covering 30% of the costs of installing low-cost solar power and of purchasing clean trucks and vans for commercial fleets.
• ELECTRIC VEHICLES: The Inflation Reduction Act will make it easier and cheaper to purchase an electric vehicle, with upfront discounts up to $7,500 for new EVs and $4,000 for used EVs, helping middle-class Americans skip the gas pump and save on fuel costs.

In Michigan, millions of people will be eligible for these discounts. Michigan recently submitted a state plan for using funds from President Biden’s Bipartisan Infrastructure Law to build out EV charging stations along highways.
• CLEANER AIR: The Inflation Reduction Act will significantly reduce pollution, resulting in 100,000 fewer asthma attacks in America in 2030, and position the U.S. to achieve President Biden’s climate goals. Lowering greenhouse gas emissions will not only avoid costly climate impacts from more extreme weather, but also improve local air quality— preventing premature deaths and reducing air pollution. In addition to reducing pollution across the economy, the Act will benefit communities most in need of cleaner air, with in environmental justice block grants, investments for cleaner buses and trucks, and a Clean
Energy and Sustainability Accelerator that will prioritize emissions-reducing projects in disadvantaged communities and fund state and local green banks like Michigan Saves.
• RURAL OPPORTUNITIES: The Inflation Reduction Act supports climate-smart agriculture practices, which will help Michigan’s 46,000 farms lead on climate solutions and reward their stewardship. Electric cooperatives, which serve about 330,000 homes, businesses, and other customers in Michigan, will for the first time be eligible for direct-pay clean energy tax credits. And this legislation dedicates investments for rural electric cooperatives to boost resiliency, reliability, and affordability, including through clean energy and energy efficiency upgrades.
• RESILIENT COMMUNITIES: The Inflation Reduction Act will upgrade affordable housing, including projects that boost resilience in the face of intensifying extreme weather. In
Michigan, tens of thousands of people live in affordable housing units that are eligible for upgrades like flood-proofing and storm resistance, as well as clean energy and electrification. A new Neighborhood Access and Equity Grant Program includes support
for transportation projects and planning to protect against flooding, extreme heat, and more. The Inflation Reduction Act also invests in strengthening America’s forests, including programs focused on preventing wildfires and for tree planting projects that help protect communities from extreme heat.

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