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Legislative Extension of Bush Tax Cuts
The Senate and House have approved the following three pieces of legislation: The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. With President Obama’s signature expected in the near future, this legislation will take effect January 1, 2011. Paycor is prepared to take all necessary measures to update our payroll services for all our clients.
Here are some key aspects of this legislation:
- Employee Social Security payroll tax is reduced by 2.0% (from 6.2% to 4.2%) for one year starting with payrolls dated 1/1/2011.
- Income tax rates will remain at their current levels of 10%, 15%, 25%, 28%, 33% and 35% based on income levels. These rates will remain in effect for two tax years, 2011 and 2012.
- The supplemental tax rate will remain 25% for 2011 and 2012.
- Unemployment benefits are extended through 2011.
- Businesses may write off any capital investments made from September 9, 2010 through the end of 2011.
- The college tuition $2,500 credit is extended through 2012.
If you would like to learn more about how this will affect your company, please contact your specialist.
To read more about the tax-cut extension, click here.