Nationally, the credit provides over 110 million working families—about 95 percent—the tax relief they need right now and will give nearly $60 billion to America’s working families, officials said.
The money from the “Making Work Pay Tax Credit” shows up immediately in paychecks as employers withhold fewer tax dollars under new Internal Revenue Service guidelines. President Obama signed the tax credit into law in February as part of his plan to help families being squeezed during the current recession.
“This is one of the fastest and broadest tax cuts in American history,” the administation said. Among the provisions:
• For 2009 and 2010, the “Making Work Pay” tax credit provides a refundable tax credit of 6.2 percent of earned income up to $400 for working individuals and $800 for married taxpayers.
• Families should see at least a $65 dollar per month increase in their take home pay.
• The credit will phase out for taxpayers with adjusted gross income in excess of $150,000 for married couples filing jointly and $75,000 for other workers, and thus is fully phased out for taxpayers with modified adjusted gross income in excess of $190,000 for married workers and $95,000 for other workers.
“The typical American family will have about $800 extra cash over the next year delivered to them in their paychecks to spend and to help the economy get back on track,” the administration said.
Share
Nationally, the credit provides over 110 million working families—about 95 percent—the tax relief they need right now and will give nearly $60 billion to America’s working families, officials said.
The money from the “Making Work Pay Tax Credit” shows up immediately in paychecks as employers withhold fewer tax dollars under new Internal Revenue Service guidelines. President Obama signed the tax credit into law in February as part of his plan to help families being squeezed during the current recession.
“This is one of the fastest and broadest tax cuts in American history,” the administation said. Among the provisions:
• For 2009 and 2010, the “Making Work Pay” tax credit provides a refundable tax credit of 6.2 percent of earned income up to $400 for working individuals and $800 for married taxpayers.
• Families should see at least a $65 dollar per month increase in their take home pay.
• The credit will phase out for taxpayers with adjusted gross income in excess of $150,000 for married couples filing jointly and $75,000 for other workers, and thus is fully phased out for taxpayers with modified adjusted gross income in excess of $190,000 for married workers and $95,000 for other workers.
“The typical American family will have about $800 extra cash over the next year delivered to them in their paychecks to spend and to help the economy get back on track,” the administration said.