FACTBOX: Obama and McCain offer competing economic plans

(Reuters) - The faltering economy has become the central focus of the presidential campaign in the final days before the November 4 election. Both Republican John McCain and Democrat Barack Obama have offered short term stimulus proposals and longer term packages to jump start the economy and provide for longer term growth.

The next U.S. president, who will take office on January 20, 2009, will be operating in the context of a record budget deficit of at least $500 billion. Some analysts say it could reach as much as $1 trillion next year.

Republican John McCain has proposed a $52.5 billion short-term economic stimulus plan that would:

--Use $300 billion of the $700 billion financial rescue package recently enacted to buy troubled mortgages and replace them with manageable fixed-rate mortgages.

--Reduce taxes on the first $50,000 of withdrawals from IRA and 401(k) retirement accounts to 10 percent for the next two years. Currently, withdrawals at retirement are taxed at regular income tax rates that range from 10 percent to 35 percent.

--Suspend rules that require retirees to begin withdrawals from retirement accounts six months after they reach the age of 70. The delay would allow retirees to ride out the current market crisis and stock market decline.

--Increase the amount of capital losses from the sale of stocks and other assets that can be written off against ordinary income to $15,000 from $3,000.

--Reduce the top tax rate on long term capital gains, currently at 15 percent, to 7.5 percent for two years.

--Exempt unemployment benefits from taxes for two years.

--In the longer term, McCain has proposed extending President George W. Bush's tax cuts, which expire at the end of 2010 and cutting the top corporate tax rate to 25 percent from 35 percent.

--McCain said he would cut government spending and promote free trade agreements.

Barack Obama has proposed an economic stimulus plan that some experts estimate could cost as much as $190 billion. Obama said he would:

--Enact a windfall profits tax on oil companies to give taxpayers an energy rebate.

--Give businesses a $3,000 refundable tax credit for each new full-time employee hired in the United States over the next two years.

--Allow small business to immediately write off up to $250,000 in spending for new equipment and property through the end of 2009. The stimulus package enacted earlier this year provided for the $250,000 investment expensing limit only through the end of this year.

--Eliminate capital gains taxes on investments in small businesses.