Washington, DC –Today, the Making Work Pay tax credit will go into effect, giving a tax cut to over 110 million American families, including 1.4 million families in Oregon who will save a combined $700 million in federal taxes.
The tax credit is part of the American Reinvestment and Recovery Act that Senator Merkley worked with his colleagues in Congress and President Obama to craft and pass.
“Most Oregon families are going to begin seeing a bump in their paycheck today as a result of the Making Work Pay tax credit,” said Merkley. “This added income will provide direct assistance to families who have been hit by this harsh economy and help move our economy in the right direction. And in contrast to the past eight years, these cuts are squarely targeted to working families. This is the kind of change Americans were looking for when they cast their ballots last fall.”
For 2009 and 2010, the Making Work Pay tax credit tax credit provides a refundable tax credit of 6.2 percent of earned income up to $400 for working individuals and $800 for married taxpayers. The credit will reach about 95 percent of American families who will see smaller withholdings from their paychecks starting this month.
Thanks to the passage of the Recovery Act, the typical American family will see about an extra $800 over delivered in their paychecks for them to spend and help get the economy back on track.