Congress has approved and the President has signed new economic stimulus legislation, the American Recovery and Reinvestment Act of 2009. The IRS is implementing tax-related provisions of this new program as quickly as possible.
Detailed information is currently available on the $400-to-$800 Making Work Pay Tax Credit and the Economic Recovery Payment, which is worth $250 to certain recipients of benefits from the Social Security Administration, Veterans Administration and Railroad Retirement Board. (See all links in Resource Box below.)
Information on other provisions of the stimulus law will be available on the IRS web site, at IRS.gov, as they become available.
Following are a few general questions and answers regarding the new stimulus package:
Q. Could the new legislation affect 2008 tax returns?
A. Generally, no. The new legislation does not have any major impact for the vast majority of individuals preparing their 2008 tax returns due April 15. Instead, these changes will largely impact 2009 tax returns filed next year, in 2010. Taxpayers should continue to prepare their 2008 tax returns as they normally would.
A. There are a few limited areas in the legislation that could impact 2008 tax returns.
For example, for some small businesses, changes in the net operating loss provisions could affect 2008 tax returns. More details on this and other changes — such as the first-time homebuyer’s credit — will be available soon.
Q.Does this new stimulus legislation have any impact on the recovery rebate credit for 2008 tax returns being filed now?
A. No. But the IRS reminds taxpayers and tax preparers to make sure they properly determine eligibility for the recovery rebate credit before they file their 2008 federal tax returns.
Q. Where are more details on the tax provisions of the legislation?
A. The IRS will be providing more details on this web site as it becomes available. A summary of the key provisions is available from the Senate Finance and House Ways and Means committees.
- Ask TaxMama :: Where taxes are fun and answers are free
www.TaxQuips.com :: The number ONE free tax podcast online
- Senate Finance Committee :: summary of the key provisions in the American Recovery and Reinvestment Act of 2009
- IRS explanation of :: Making Work Pay
- IRS explanation of :: Economic Recovery Payment
IRS Tips :: Tips to Avoid Recovery Rebate Credit Confusion
- SAVE THIS PAGE! :: IRS will be updating this page with reports about the American Recovery and Reinvestment Act of 2009 provisions
- Recovery.gov :: Obama's watchdog site to oversee spending of the funds