HR 155 To suspend Taxes on Unemployment

Here's the bill for HR155. This will suspend Taxes on unemployment. I got this from Open Congress. It would be good if this is approve too when then come back.

To amend the Internal Revenue Code of 1986 to suspend the taxation of unemployment compensation for 2 years. ‘
Bill # H.R.155
Original Sponsor:
John McHugh (R-NY 23rd)
Cosponsor Total: 43
(last sponsor added 07/28/2009)
7 Democrats
36 Republicans

About This Legislation:

1/6/2009–Introduced.
Suspension of Federal Income Tax on Unemployment Benefits Act of 2009 - Amends the Internal Revenue Code to suspend, for taxable years beginning after December 31, 2008, and before January 1, 2011, the taxation of unemployment compensation.

help wrote:Here's the bill for HR155. This will suspend Taxes on unemployment.

(I posted a comment about S. 155 over in the other thread before I saw this here.)

Note that the Senate has a corresponding bill, S. 155 by Sen. Snowe, introduced before the stimulus package passed. At least that's a good start, but I have no idea if these will gain momentum.

Just some trivea here that may be of interest:

The Reuters story at this link on the Washington Post was pulled this morning apparenty at the request of the White House. I found this odd because Reuters is not known for publishing advisarial critiques of the Administration. I thought it was relevent to us as the article reported (amoung many distressing things) that the FY2011 budget just proposed by the Administration eliminates the $2400 exemption for Unemployment Benefit recipients (for tax year 2010) , and it reportedly eliminates the 10% Federal tax bracket (in lieu of a tax increase by raising the rate) for singles for the first $8350 of income, for joint filers it would be the first $16,700, head of housolds first $11,950. (these income levels are currently @ 10% Fed tax)

The link says the article will be re-posted later in the week (presumably when Reuters attends to the White House objections) . I'll post it when I see it, since the proposed budget is written down , if what Ive stated above is true it should be reported by other news outlets in the comming days.

If true, I dont know if this means the Administration will be advocating further unemployment extensions so they can get more tax revenue, or they assume there wont be that many people collecting any lengthy extensions so they dont care that they are raising taxes on our group. The good news is, even if true this would have to pass muster of the Congress, I cant believe they would pass something like this in this political climate.

I'll withold my revulsion until I see this confimed in print.

FYI

http://www.washingtonpost.com/wp-dyn/content/article/2010/02/01/AR2010020102606.html

I found the orginal of the subject article. Again, Reuters has pulled this at the request of the White Hoiuse.


http://ca.news.yahoo.com/s/reuters/100201/us/usreport_us_budget_backdoortaxes

Interesting that a tax cut for the unemployed is a Republican sponsored bill.

I ran a search on this bill, and this is what I found: http://www.gaycitynews.com/articles/2010/02/09/perspectives/opinion/doc4b4f7fdcd1de3678132564.txt

Just a FYI, as I hadnt seen much on this lately- I have been reading my 2010 IRS Tax Guide (Pub 17). Its says the first $2400 of Unemployment Benefits IS taxable for tax year 2010.

HNY

sc4ram wrote:Just a FYI, as I hadnt seen much on this lately- I have been reading my 2010 IRS Tax Guide (Pub 17). Its says the first $2400 of Unemployment Benefits IS taxable for tax year 2010.

HNY

They were too busy drooling over those tax cuts for the very wealthy to give any thought to the unemployed who will still be responsible for taxes on benefits, a totally counter-intuitive tax if ever there was one.

But everyone should make sure to check if they qualify for either the Earned Income Credit or the Making Work Pay credit if they earned any income whatsoever in 2010, even if it was just odd jobs or temp work that you had to report to AWI.

Also, just a note, if you had some small income from odd jobs that you report on a Schedule C, I found the nuttiest thing last year on those forms. It seems that when I used the tax software (either purchased or the free online stuff) that calculates your refund as you go along, I could see that reporting absolutely all my expenses (home office, etc., etc.) could actually delete my eligibility for the Making Work Pay credit by creating a loss on Schedule C, and boosted my tax bill by around $100 or so!!! It was really odd-- I got it down by experiment that one CENT one way or the other would affect my total due by a big amount! Quite ridiculous, as is most of our tax system, IMO.

So if you did any freelance, you can be honest about your income, but how you fill the forms can make a crazy difference!