Taxpayer asks:
Was the “Making work Pay” tax credit extended?
taxgirl says:
No, the Making Work Pay Credit was not extended as part of The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act which was signed into law on December 17, 2010. The credit is still applicable for the 2010 tax season since it was in effect for all of the 2010 calendar year. This means that the credit will still be calculated as part of your individual federal income tax return for 2010. For more information on the Making Work Pay Credit, see this prior post.
For the current calendar and tax year (2011), the payroll tax holiday will effectively replace the Making Work Pay Credit.
Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.
From what I have seen depending upon the exemption and withholdings, some people will have a higher net and some people will have a lower net with the expiration of making work pay combined with the payroll tax holiday. As usual, taxes are never as boring as people think…
The Making Work Pay Credit offered a credit for people receiving a governmental pension other than Social Security. Retired teachers and state employees received a benefit. The replacement gives no benefit to workers or retirees outside the Social Security system.