These Lawmakers Want to Give You $2,500 a Year for Shopping

U.S. households will get reimbursed up to $5,000 per year for purchases of specific types of goods if a newly introduced bill becomes law.

The Made in the USA bill would establish a refundable tax credit worth up to $2,500 per person (or $5,000 per couple filing jointly) for purchases that meet the requirements of the federal government’s Made in USA standard.

A refundable tax credit is the most valuable type of tax credit. It can do more than reduce the amount of taxes you owe. It also can increase the amount of your tax refund, or result in you receiving a refund even if you don’t owe taxes.

The newly proposed tax credit is designed to “invigorate U.S. manufacturing, create good-paying jobs, and protect workers by incentivizing and rewarding consumers for buying American-made goods,” according to a press release about the bill, which is co-sponsored by Rep. Debbie Dingell (D-Mich.) and Ro Khanna (D-Calif.).

In the release, Khanna says:

“This bill will make items more affordable for consumers and help support American businesses and workers. It’s an important piece of what needs to be a sweeping set of policy actions designed to restore American manufacturing and technology leadership and a call to respect workers who will help our country achieve that goal.”

The Federal Trade Commission’s Made in USA standard requires that “all or virtually all” of a product be manufactured domestically for it to be labeled “Made in USA.”

If the Made in the USA Tax Credit Act becomes law, the maximum value of the tax credit would be indexed to inflation, meaning it would increase over time to account for inflation.

Certain goods would be excluded from qualifying for the credit, even if they meet the Made in USA standard. They include:

• Firearms
• Food
• Fuel
• Luxury goods
• Non-depreciable property
• Services
• Tobacco products
• Vehicles

To qualify for the credit, an individual would have to earn less than $125,000 and have less than $20,000 in investment income.

Married couples filing jointly would have to earn less than $250,000 and take in less than $40,000 in investment income.

As of publication time, the text of the bill was not yet available on the Congress.gov website, and Dingell and Khanna’s press release did not include a copy.

In addition, neither the Congressional Budget Office nor the nonpartisan Joint Committee on Taxation has analyzed the bill yet, so no cost estimate is available.

The bill also has a long way to go before it could possibly become law. Introduced in late February, it has yet to reach a committee.

Assuming a House committee votes to advance the bill, the full House of Representatives and Senate then would have to adopt identical versions of the legislation before it could be sent to the president to be signed into law.

Meanwhile, if you wish to let your representatives know how you feel about the Made in the USA bill, contact them.