Stimulus plan Feed

In 1492 Columbus sailed the ocean blue. Apparently, that line is just the beginning of a whole Columbus discovers the New World song. Who knew? But it's a nice little Google discovery for today, the U.S. federal holiday honoring Christopher Columbus. Three-day weekends haven't meant as much to me since I left D.C., birthplace of time off for federal employees. And now the Wall Street Journal tells us that Columbus Day is in danger of sailing off the calendar. That would be too bad. Any event for which you can throw parade is fun. Yeah, I know; tax dollars spent... Read more →

Since the bursting housing bubble was the event that sent the U.S. economy into the tank, it's no surprise that we all continue to be fixated on real estate. You or someone you know is looking to sell, buy or, in my case, wondering about the new neighbors who soon will be moving into the neighborhood. I presume they'll be here shortly. There are two huge crates from sitting in the driveway. Housing also is getting renewed attention in the tax world. The IRS is reminding first-time home buyers that time is running out for them to take advantage... Read more →

Crime reportedly doesn't pay, but Uncle Sam recently handed out $250 checks to almost 4,000 jailed felons. The payments were mistakenly issued as part of the American Recovery and Reinvestment Act, popularly known as the February 2009 stimulus law. Under the Making Work Pay credit portion of the new law, workers have seen a smaller amount of payroll taxes withheld from their paychecks. But folks who don't have jobs also got a stimulus benefit. Separate $250 checks were sent to 54.4 million beneficiaries of Social Security, veterans and federal railroad payments. And some of those check recipients are behind bars.... Read more →

IRS expanding video options

Can't find a program that appeals to you on TV? Tune in the IRS network! Yes everyone's favorite federal agency, the Internal Revenue Service, is taking new media very seriously. The IRS now has its own YouTube page, with a collection of video presentations for your viewing and tax pleasure. The videos cover a variety of relevant tax topics and are in English, American Sign Language (ASL) and Spanish. In addition, iTunes aficionados can find IRS podcasts at that site. The latest IRS clips contain information on the 2009 stimulus plan, otherwise known as the American Recovery and Reinvestment Act.... Read more →

April 15 is a distant memory for most taxpayers, but as the IRS works through the millions of tax year 2008 filings it has received, some folks are learning their rebate claims are causing problems. You remember the rebates. They were the $300 to $600 checks that were approved in February 2008, sent out that spring and were supposed to jump start the economy. The amount of those checks was based on 2007 income, but they actually were "prebates" that were accounted for on 2008 returns as the Recovery Rebate Credit. And that's where the trouble started. Folks who didn't... Read more →

We got lucky this week in Central Texas. Temperatures have been seasonal, meaning we've had nights in the upper 50s and days in the low 80s. Our suburban neighborhood always seems a bit cooler than the city's official thermometer readings, so the hubby and I were able for three days this week to turn off the air conditioning and make do, quite comfortably, with ceiling fans. One night I even had to pull out a light blanket to counter the cool air that filled the house through our open windows. But that’s definitely changing. Soon we'll be in the heart,... Read more →

Small business stimulus tax breaks

Since we're in the midst of national Small Business Week (it runs through May 23), the IRS is taking the opportunity to point out some of the business tax breaks in the new stimulus law. The American Recovery and Reinvestment Act of 2009, enacted Feb. 17, created, extended or expanded various business tax deductions and credits. They include extension of the bonus depreciation, the increased Section 179 deduction, the expanded net operating loss carryback, the exclusion of gain on the sale of some small-business stock, estimated tax requirement changes and a COBRA credit. Some of these tax breaks are available... Read more →

The only thing worse than having to collect unemployment is having to pay taxes on it. That's right, Uncle Sam considers this last-resort money as taxable income. This tax fact is a surprise to many laid-off workers. And the ranks of folks facing the dual shock of losing a job and then owing the IRS money on unemployment benefits keeps growing. The Bureau of Labor Statistics announced last Friday that in April another 563,000 were without work, pushing the total jobless to 13.7 million. That translates to a national unemployment rate of 8.9 percent, a 26-year high. However, there is... Read more →

Making Work Pay problems revisited

Timing is everything, especially with taxes ... and tax information. On March 5, I blogged about the potential tax problems some folks might face in connection with the Making Work Pay credit. You know this tax break. It's the centerpiece of the Obama stimulus, formally known as the American Recovery and Reinvestment Act, that became law on Feb. 17. The deal is that workers get a $400 credit, which offsets the 6.2 percent employee portion of the Social Security withholding taken out of paychecks. But rather than make us wait until we file our 2009 returns next year, the money... Read more →

My mother will be so happy. Not that she didn't believe me, her perfect daughter (her words, not mine; really!), when I told her back in February that she and her friends would be getting some extra spending money thanks to the American Recovery and Reinvestment Act. But, like her journalist daughter, my mom likes a little verification on important things like unexpected money from Uncle Sam. SSA on the job: That assurance came yesterday when Mary Glenn-Croft, deputy commissioner of the Social Security Administration, told a Congressional hearing that the new law's payments to retirees would be delivered in... Read more →

A reader dropped me a note with her concerns about the new first-time homebuyer credit: I heard that under the $8,000 tax amendment for new home owners, upon sale of the property the government would own half the property (guaranteed 50% equity share). Will the government own 50% of my grandson's home upon its sale? Thank you. -- Dolores Dolores, you and your grandson can relax. Uncle Sam does not want half equity in his house or the tens of thousands of others where the buyers qualify for this new tax break. Credit clarifications: Before we go further, though, I... Read more →

My dear hubby and book PR people keep telling me I need to share more. No, not all the icky personal stuff, but tax- and book-related items that pop up here there, now and then. They're probably right, but don't tell my husband I said that! What with tax season hitting high gear, such reviews, interviews, mentions and stories I've written for places other than my regular Bankrate gig have been piling up. So rather than piecemeal them out, here they are in one comprehensive post for you to enjoy (or ignore! but I hope not!) as you please. First... Read more →

Not too long ago I talked about the possibility that you might need to coordinate your state withholding in light of the recently enacted American Recovery and Reinvestment Act, aka Obama's first stimulus package. Well, the effects of the new Making Work Pay credit continue to give us a lot to ponder in this area, even before it starts be doled out in April via reduced paycheck payroll taxes. In addition to the state withholding issues, folks who aren't eligible for the full $400 paycheck payout will face some tax considerations. Below is a quick look at such taxpayers. Dependents... Read more →

State withholding and the stimulus

It's always something with taxes, isn't it? While the IRS gets kudos for so quickly revamping the federal withholding tables to align with the recently enacted American Recovery and Reinvestment Act of 2009, there are still some issues a bit up in the air. One is in connection with state income tax withholding. This is something, as noted in my earlier post on the short-term hold put on Kansas refunds, that workers in taxpayers in 41 states and D.C. have to worry about. In an interview with Tax Analysts, a spokesperson for the payroll service Paychex noted that additional IRS... Read more →

The good news about the Making Work Pay credit, a key provision of the just-enacted stimulus bill, is that it will be showing up in paychecks sooner that most of us expected. As I noted earlier, the IRS knew delivery of the credit money was going to be via paychecks well before it passed. That gave the agency a head start in getting the distribution method ready so that the money would be in taxpayer hands quickly. Well, the IRS' efficiency in this case has impressed me. In an announcement posted at the agency's Web site today (yes, on a... Read more →

It's official. The American Recovery and Reinvestment Act of 2009 is now law.Embedded video from CNN Video There's been lots of coverage, in blogs and traditional media, of the various provisions. I'm working on a story on the Making Work Pay credit. I'll pass along the finished product link when it's published. However, I already touched on the highlights in "Stimulus yes, rebate check no" and "OK, some rebate checks." Below is a quick rundown of some other key individual taxpayer provisions in the new law. AMT again: There is another one-year alternative minimum tax patch that will keep millions... Read more →

For workers, the new Making Work Pay tax credit provision in the just-passed stimulus package will mean a few extra dollars in their paychecks. The latest word is that about $13 a week should start showing up in pay envelopes in June. But what if you don't get a paycheck? That would be the case for retirees and veterans. During last year's stimulus rebates process, these folks got a $300 payout based on the amount of retirement money they received as long as they filed a tax return to let the IRS know of the benefits. That rebate system is... Read more →

The latest economic stimulus package, officially known as H.R. 1, the American Recovery and Reinvestment Act of 2009, is halfway home. The House signed off on the compromise measure this afternoon. The Senate could possibly vote on the bill tonight. As soon as details about what was in the bill, and especially the Making Work Pay credit, started coming out, people started asking questions. Now that the new tax break is imminent, the queries are coming fast and furious. "I already filed my taxes for this year. Do I need to refile now to get this money?" asks Jessica. "Will... Read more →

Everyone knows by now that the Senate approved its stimulus package. I haven't written much (any) on it or the previously approved House version. Why not? Because this stew is still simmering and a lot of cooks will be stirring it in the next few days. As noted in every report on the stimulus packages, the House and Senate have different ideas about what's needed. Some things from both proposals likely will be changed or eliminated altogether. So I'm not getting too excited about what a final bill will or won't do until there is an actual final bill. That... Read more →

Over the weekend, the chances for a stimulus package relatively soon improved greatly. A group of Senators met on Saturday to devise that legislative body's answer to the previously passed House bill. But there's much work to be done. And it looks like the original deadline of having a measure signed by Obama by the Presidents Day holiday probably won't be met. The reason: There's still lots of political sniping going on, not only between Democrats and Republicans, but also within the parties. Some of the down-and-dirty details are chronicled in U.S. News' Political Bulletin. Now I'm not saying that... Read more →