Schulz Consulting

Consulting and Upgrades

  • Home
  • Services
  • Contact

IRS updated withholding tax schedules released 2-21-09

February 26, 2009 by Wayne Schulz

The Internal Revenue Service today released new withholding tables that will result in more take-home pay this spring for millions of American workers.

The new tables incorporate the new Making Work Pay credit, one of the key tax provisions included in the American Recovery and Reinvestment Act of 2009 that became law earlier this week.

UPDATE: 12/24/09 – The 2010 IRS Withholding Tax Tables have been released and we have a copy at this link.

“For most taxpayers, the additional credit will automatically start showing up in their paychecks this spring,” said IRS Commissioner Doug Shulman. “Since employers and payroll companies will handle this change, people typically won’t need to take any additional action. The IRS will continue working to implement this and other provisions of the new law as quickly as possible.”

The new withholding tables, along with other instructions related to the new tax law, will be incorporated in new Publication 15-T. This publication will be posted to this Web site next week and mailed to more than 9 million employers in mid-March. The IRS asks that employers start using these new tables as soon as possible but not later than April 1. Most workers will see a boost in their take-home pay soon thereafter.

Eligible workers will get the benefit of this change without any action on their part. This means that workers don’t need to fill out a new W-4 withholding form to get the Making Work Pay credit reflected in their take-home pay. A Form W-4 will not need to be submitted for the automatic withholding change. Individuals and couples with multiple jobs may want to submit revised Form W-4 forms to ensure enough withholding is held to cover the tax for the combined income. Publication 919 provides additional guidance for tax withholding.

Available for tax years 2009 and 2010, the Making Work Pay credit is 6.2 percent of a taxpayer’s earned income with a maximum credit of $800 for a married couple filing a joint return and $400 for other taxpayers, but it is phased out for higher income taxpayers. Most workers will qualify for the maximum credit. Because the credit is refundable (people can get it even if they owe no tax), most low-income workers will also qualify for the full credit.

Though all eligible taxpayers will need to claim the credit when they file their 2009 income tax return next year, the benefit will generally be spread out over the paychecks they receive beginning this spring and continue until the end of the year.

Many higher-income taxpayers will see little or no change in their take-home pay. That’s because the Making Work Pay credit is phased out for a married couple filing a joint return whose modified adjusted gross income (AGI) is between $150,000 and $190,000 and other taxpayers whose modified AGI is between $75,000 and $95,000

Taxpayers will not get a separate, special check mailed to them from the IRS like last year’s economic stimulus payment.

New IRS Tax Tables February 2009

Publish at Scribd or explore others: Business & Legal 2009 irs publication 15t

Share this:

Filed Under: Technical Documents, Tips and Tricks, upgrades Tagged With: 15-t, irs, mas200, new tax table, payroll, payroll tax tables, publication 15-t, Sage 100 ERP, stimulus

Secure cloud hosting for Sage 100
Call 1-888-244-6559 (toll-free)

About Wayne Schulz

Wayne Schulz is a Sage 100 Consultant located in Connecticut. He has worked with Sage 100 since 1986 and provides advanced support to companies located throughout the United States. If you are experiencing an issue with Sage 100 and would like to schedule a support session - please request assistance here or call 860-657-8544.

Access Sage 100 in the cloud today. 3rd party applications supported Available 24/7 from anywhere. Dedicated hosts

Call 1-888-244-6559 (toll-free)

Search Our Site

Sage 100 Newsletter

Sage 100 News

  • How To Edit 1099 Totals In Sage 100
  • How to Reconcile Sage 100 Accounts Payable Detail to the General ledger
  • Sage 100 Year-End 2022 Training Series
  • Minimum Sage 100 Versions for E-Filing for Tax Year 2022
  • What Are The Differences Between These Sage Fixed Asset Versions: Lite, Single-User, Network and Premier?
  • Sage 100 Paperless Email Electronic Delivery Failing With Rackspace
  • How To Check Sage 100 Compatibility with Avalara’s TLS 1.2 Requirement
  • Sage 100 TLS 1.2 Compliance Update ( Nov 2022)
  • What Are My Sage 100 Mobile Sales Options?
  • Sage 100 Payroll Tax Update Set for 10/27/22 for New York State Health Care Workers Bonus Program (HWB)

Contact Us

Schulz Consulting
Connecticut Office
Click Here To Contact Schulz Consulting
Email Us
Available remotely nationwide.
We are a local branch of DSD Business Systems Connecticut.

Copyright © 2023 · Parallax Pro Theme on Genesis Framework · WordPress · Log in