03-31-2009 5:59 PM Liz

Work Pay Credit

The American Recovery and Reinvestment Tax Act of 2009 provides a refundable credit of up to $400 for working individuals and $800 for working families.  The credit is calculated at 6.2% of of earned income, and phases out for taxpayers with modified adjusted fross incme in excess of $75,000 (or $150,000 for married couples filing jointly).   Nonresident aliens and individuals who can be claimed as a dependent do not qualify for the credit.  Taxpayers can receve this benefit by reducing the amount of income tax that is withheld from their paychecks or through claiming the credit on their tax returns.   Make sure you take advantage.

 

 

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