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Washington Watch - February 25, 2009


Obama: Small Biz Health Care Reform Needed
In his recent address before Congress, Obama highlighted health care and the need for health care reform, especially to help small businesses and their insurance needs. The NASE remains very engaged in this debate, working with your legislators to make sure the issue remains a top priority. We continue to advocate that the self-employed must be able to exclude health insurance premiums from self-employment tax regardless of the entity form under which they choose to operate.

The NASE heads up the coalition supporting Equity for Our Nation’s Self-Employed, which brings together over 40 small business organizations, working to remove this unfair tax burden on the self-employed. For more information, please visit our coalition website at www.setaxequity.org.
From the IRS: Tax Provisions In The 2009 Stimulus Package
Congress has approved and the President has signed new economic stimulus legislation, the American Recovery and Reinvestment Act of 2009. The IRS is implementing tax-related provisions of this new program as quickly as possible.

Here are some key highlights:
  • Payroll Checks Increase This Spring. The Making Work Pay Tax Credit will mean $400 to $800 for many Americans. The IRS has issued new withholding tables for employers.
  • $250 for Social Security Recipients, Veterans and Railroad Retirees. The Economic Recovery Payment will be paid by the Social Security Administration, Department of Veterans Affairs and the Railroad Retirement Board.
  • Money Back for New Vehicle Purchases. Taxpayers who buy certain new vehicles in 2009 can deduct the state and local sales taxes they paid.

Information on other provisions of the stimulus law will be available on this Web site, www.IRS.gov, as they become available.

Following are a few general questions and answers regarding the new stimulus package:

 


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 some small businesses, changes in the net operating loss provisions could affect 2008 tax returns. More details on this and other changes — such as the first-time homebuyer’s credit — will be available soon.

 


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.

For more information, visit www.IRS.gov.

 



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