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claim it annually. Withholding formulas directed employers to increase take-home pay immediately without action from employees. Taxpayers with multiple jobs or self-employed had to adjust withholding to avoid inadvertently receiving multiple credits. Workers with multiple jobs, or unemployed, had the option to delay receiving the credit and receive instead a lump sum (all $ 400 to $ 800 at once) calculated on the tax return filed in the following year. Reconciling the credit required filing
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The credit was given at a rate of 6.2 percent of earned income up to a maximum of $ 400 for individuals or $ 800 for married taxpayers. Making Work Pay could be claimed by single filers making between $ 8,100 per year and $ 95,000 per year. Joint filers in the range of $ 8,100 and $ 190,000 could
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in 2009. Because Making Work Pay contributed to higher take home pay by reducing withholding, it was assumed that the recipients would spend the majority, if not all, of the credit.
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The credit was not extended to tax year 2011, and has not been considered since then; instead, Congress passed a payroll tax holiday for two years.
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provided in tax years 2009 and 2010 to U.S. federal income taxpayers. It was authorized in the
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Steve
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The policy concept behind the Making Work Pay tax credit was to stimulate
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Withholding of Income Taxes and the Making Work Pay Tax Credit
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Tax Policy Center Tax Topics: 2011 Budget Tax
Proposals
99:"Federal Tax Cuts in the Bush, Obama, and Trump Years"
115:Making Work Pay Tax Credit information at IRS.gov
120:Making Work Pay Questions and Answers at IRS.gov
142:American Recovery and Reinvestment Act of 2009
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87:"The tax hike nobody's talking about"
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157:Personal taxes in the United States
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133:Congressional Research Service
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89:Blake Ellis, CNN, 2010-07-27
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18:Making Work Pay tax credit
68:Earned Income Tax Credit
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162:Tax credits
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