Editorâ€™s note: Taken from the IRS website on 2/18/09. For updated information, please visit the IRS website directly.
Congress has approved and the President has signed new economic stimulus legislation, the American Recovery and Reinvestment Act of 2009. The IRS is working closely with Congress and the administration on the stimulus legislation and will implement tax-related provisions of the new program as quickly as possible.
Additional details will be available on this Web site, IRS.gov, as soon as they become available.
Following are a few questions and answers on the legislation.
Could the new legislation affect 2008 tax returns? 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.
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 â€” such as the first-time homebuyerâ€™s credit â€” will be available soon.
When and how will people get the $400 to $800 â€œMaking Work Payâ€ tax credit? Taxpayers will not get a separate, special check mailed to them like last yearâ€™s economic stimulus payment.
For many taxpayers, the additional credit will automatically start showing up in their paychecks this spring. For people who receive a paycheck, the credit will typically be handled by their employers through automated withholding changes. For some other people, the credit can be claimed when they file their 2009 tax return next year.
More details about the â€œMaking Work Payâ€ credit will be available soon, including an updated version of the withholding tables contained in Publication 15, (Circular E), Employerâ€™s Tax Guide.
Does this new stimulus legislation have any impact on the recovery rebate credit for 2008 tax returns being filed now? 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.
Where are more details on the tax provisions of the legislation?
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.
Page Last Reviewed or Updated: February 17, 2009