My paycheck was Stimulated

**creditcardfree** · 03-06-2009, 07:26 AM

Good news! I can see DH's check for next week and it is showing an additional $30. I guess we are getting stimulated, too. We're paid twice a month.

The extra money is going to our home equity payoff!

**Aleta** · 03-06-2009, 07:34 AM

I thought that was supposed to start in April. Supposedly the IRS is supposed to send out the new rate schedules although we haven't received ours. What I'm wondering is how will we be able to get in the full year if we start in April unless, it gets evened out in the tax return next year.

**creditcardfree** · 03-06-2009, 07:38 AM

I believe it is refundable, therefore, the additional tax cut will show up when you file next year. Rate schedules are already on the irs website. I wrote about it on my blog a little while back.

Employers have to start by April, but they can start before.

**TBH** · 03-06-2009, 08:16 AM

Wow, that's great!

My income is so irregular it's hard for me to see if there's a difference, but there was a $17.42 increase in my spouse's take-home pay today.

**Russell** · 03-06-2009, 08:30 AM

And what are you planning to do with this additional money? The idea behind it was that you would spend that additional $10-$30 on eating out or going to the movies but will you even notice it with all the other expenses and bills?

**disneysteve** · 03-06-2009, 08:30 AM

We both have irregular paychecks so I wouldn't notice a small change in the amounts.

**reptile411** · 03-06-2009, 08:35 AM

LOL

we got a notice last week at work that those of us that take our vacation pay in a lump sum "I do not" will now be charged the federal flat rate of %25 ouch.

Originally posted by autoxer View Post

The stimulus tax cut has increased this weeks paycheck by $8.09

**TBH** · 03-06-2009, 08:40 AM

Originally posted by Russell View Post

And what are you planning to do with this additional money? The idea behind it was that you would spend that additional $10-$30 on eating out or going to the movies but will you even notice it with all the other expenses and bills?

You're right--I won't really feel an additional $17 or so every two weeks. At the moment I'm trying to replenish my E-fund after some planned house repairs and unplanned car repairs, so if I do anything with it, I'll save it.

**disneysteve** · 03-06-2009, 08:44 AM

Originally posted by Russell View Post

And what are you planning to do with this additional money? The idea behind it was that you would spend that additional $10-$30 on eating out or going to the movies but will you even notice it with all the other expenses and bills?

I agree. For the vast majority of people, this amount is insignificant. It isn't enough to put gas in my car.

**woodie96** · 03-06-2009, 08:54 AM

I see no change in mine.....but I agree with DS......the amount is mostly insignificant....
May have to splurge and get some beer for cleaning the garage this weekend.....

**sweeps** · 03-06-2009, 09:05 AM

Originally posted by woodie96 View Post

I agree with DS......the amount is mostly insignificant....
May have to splurge and get some beer for cleaning the garage this weekend.....

That was precisely the plan. If the government sends you a check for $300, many people will simply deposit it in savings or pay off debt. It won't stimulate anything then.

Instead with this payroll tax cut, people don't think much of it and just buy something a little extra (like beer

) each pay period. Not saying it's right or wrong, but it's more effective as far as stimulus is concerned.

**swanson719** · 03-07-2009, 06:45 AM

This would be effective if indeed it was a stimulus. However, what it is instead, is a government mandated under-withholding of your federal income tax. Just as the $300/$600 stimulus last year was added as a tax liability, effectively reducing your return or adding in to your bill, this meager $10 or $20 a pay period will also be added as a tax liability next year. For most of us who have our withholding set so our net difference is near $0 at the end of the year, this will end up costing us a few hundred dollars. So I would suggest changing with-holdings to offset whatever it is you are seeing as the extra in order to prevent having a tax liability, or to set it in some form of interest bearing account. Spending it may help the economy in the short run, but it hurts the tax payer in April 2010.

**FrugalFish** · 03-07-2009, 07:40 AM

DH's paycheck is irregular as well, so we won't notice a difference either. I base our budget on expenses and know those when he gets paid, so any money above and beyond that goes into directly into savings. We are not doing our part to help the economy apparently.

After CA decided to hold our tax refund hostage (word yesterday is that they are going to start issuing them again now), we decided to adjust exemptions on the both the federal and state level in an attempt to not be in that position in the future- based on that, DH's paycheck should have a noticeable bump soon enough- still won't make us spend though. I only hope that his online work withholding calculator is accurate and our claimed exemptions don't come back to bite us next year...

**noppenbd** · 03-07-2009, 08:04 AM

Originally posted by swanson719 View Post

This would be effective if indeed it was a stimulus. However, what it is instead, is a government mandated under-withholding of your federal income tax. Just as the $300/$600 stimulus last year was added as a tax liability, effectively reducing your return or adding in to your bill, this meager $10 or $20 a pay period will also be added as a tax liability next year. For most of us who have our withholding set so our net difference is near $0 at the end of the year, this will end up costing us a few hundred dollars. So I would suggest changing with-holdings to offset whatever it is you are seeing as the extra in order to prevent having a tax liability, or to set it in some form of interest bearing account. Spending it may help the economy in the short run, but it hurts the tax payer in April 2010.

Can you quote a source for this information? It was my understanding that the "Making Work Pay" credit is a new credit, which means it will be an additional credit on your 2009/2010 taxes. Therefore your total tax liability will go down by that amount, meaning your withholding should not have to change.

My paycheck was Stimulated