Breaking News: Economic Stimulus Act
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| S.T.Kim Company, LLC Certified Public Accountants |
Our Mission
To maximize benefits for
our clients by going above
and beyond all others.
our clients by going above
and beyond all others.
On February 17, 2009, President Obama signed into law the American
Recvoery and Reinvestment Act of 2009 (ARRA), commonly know as the
Economic Stimulus Act. The IRS and DOL continue to define its provisions
but here are some key hightlights know so far:
Increase in Payroll Checks.
· The IRS issued revised federal withholding tables and Advanced
Earned Income Tax Credit tables that will lower the amount of federal
income tax withholding, and businesses are to utilize them no later than
April 1, 2009.
· The credit is 6.2% of earned income, up to $400 per person per year for
singles, and up to $800 for married couples. The credit phases out for
higher wage earners.
COBRA Premium Subsidy
· Employers offering a group health plan subject to federal COBRA or
similar state law regulations are required to offer premium assistance to
Assistance Eligible Individuals (AEI).
· Employees, as well as their spouses and covered dependents, would
be considered an AEI if they experienced an involuntary termination between
September 1, 2008, and December 31, 2009.
· An AEI is eligible for a 65 percent federal subsidy on their COBRA
premiums for a maximum of 9 months, and is considered to have paid their
COBRA premium in full if payment of 35 percent is made to the employer.
Form 941 – Claim COBRA Premium Credits.
· Through a revised form 941, effective first quarter 2009, the federal
government will reimburse employers for 65 percent of the COBRA premium
by allowing them to take a credit against their quarterly employer tax
liabilities.
· Additional lines on the revised Form 941 are to report the number of
COBRA premium assistance individuals and the total dollar amount of
COBRA premium assistance payments.
Additional Business Tax Provisions Include:
· 50% bonus first-year depreciation for assets purchased in the current
year.
· Businesses under $15 million in gross receipts for 2006-2008 can
carry back 2008 losses for 5 tax years.
· Asset expensing continues its $250K ceiling through 2009.
· Work opportunity credits have been expanded to include both veterans
and disconnected youths (16 to 25) who are unemployed.
Addition Individual Tax Provisions Include:
· First-time homebuyer credit for those who purchase – in 2009 – up to
$8,000 without a payback requirement.
· $250 benefit check for Social Security recipients, veterans and railroad
retirees.
· Taxpayers who buy certain new vehicles in 2009 can deduct the state
and local sales tax paid.
Details surrounding these and other tax law changes are still being
provided. Please check back with us.
Recvoery and Reinvestment Act of 2009 (ARRA), commonly know as the
Economic Stimulus Act. The IRS and DOL continue to define its provisions
but here are some key hightlights know so far:
Increase in Payroll Checks.
· The IRS issued revised federal withholding tables and Advanced
Earned Income Tax Credit tables that will lower the amount of federal
income tax withholding, and businesses are to utilize them no later than
April 1, 2009.
· The credit is 6.2% of earned income, up to $400 per person per year for
singles, and up to $800 for married couples. The credit phases out for
higher wage earners.
COBRA Premium Subsidy
· Employers offering a group health plan subject to federal COBRA or
similar state law regulations are required to offer premium assistance to
Assistance Eligible Individuals (AEI).
· Employees, as well as their spouses and covered dependents, would
be considered an AEI if they experienced an involuntary termination between
September 1, 2008, and December 31, 2009.
· An AEI is eligible for a 65 percent federal subsidy on their COBRA
premiums for a maximum of 9 months, and is considered to have paid their
COBRA premium in full if payment of 35 percent is made to the employer.
Form 941 – Claim COBRA Premium Credits.
· Through a revised form 941, effective first quarter 2009, the federal
government will reimburse employers for 65 percent of the COBRA premium
by allowing them to take a credit against their quarterly employer tax
liabilities.
· Additional lines on the revised Form 941 are to report the number of
COBRA premium assistance individuals and the total dollar amount of
COBRA premium assistance payments.
Additional Business Tax Provisions Include:
· 50% bonus first-year depreciation for assets purchased in the current
year.
· Businesses under $15 million in gross receipts for 2006-2008 can
carry back 2008 losses for 5 tax years.
· Asset expensing continues its $250K ceiling through 2009.
· Work opportunity credits have been expanded to include both veterans
and disconnected youths (16 to 25) who are unemployed.
Addition Individual Tax Provisions Include:
· First-time homebuyer credit for those who purchase – in 2009 – up to
$8,000 without a payback requirement.
· $250 benefit check for Social Security recipients, veterans and railroad
retirees.
· Taxpayers who buy certain new vehicles in 2009 can deduct the state
and local sales tax paid.
Details surrounding these and other tax law changes are still being
provided. Please check back with us.
Economic Stimulus Act
| Contact us: 301-495-3086 410-685-3040 email: stkimcompany@gmail.com |