Payroll Tax Cut Bill Extension is Now Approved!

After a week of uncertainty in Washington, Congress approved the extension of the payroll tax cut bill this morning, which if not passed, would impact 160 million taxpayers beginning January 1.

Payroll Tax

Payroll Tax

The payroll tax cut bill extension keeps taxpayers’ portion of social security tax at 4.2%, renews¬† unemployment benefits, and the medicare reimbursement rate for an additional two months.¬† When Senate leaders return from vacation, a joint House Senate panel is set to negotiate how to continue the tax break through the end of 2012.

Now Congress has gone on vacation and we can start to enjoy our holiday without worrying about a loss of income for the first two months of the year. The extension of the payroll tax bill will continue to help a typical family making $50,000 per year keep $40 additional per paycheck.

Now, how will the $40 per paycheck savings help you as you start the new year?

TurboTaxLisa

Lisa Lewis is a CPA and the TurboTax Blog Editor. Lisa has 15 years of experience in tax preparation. Her success is attributed to being able to interpret tax laws and help clients better understand them. Lisa also has been a TurboTax product user for many years and understands how the software program works. In addition to extensive tax experience, Lisa also has a very well-rounded professional background. She has held positions as a public auditor, controller, and operations manager. Prior to becoming the TurboTax Blog Editor, she was a Technical Writer for the TurboTax Consumer Group and worked on a project to write new FAQs to help customers better understand tax laws. She could also be seen helping TurboTax customers with tax questions during Lifeline. For Lisa, getting timely and accurate information out to customers to help them is paramount.

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