On February 17, 2009, President Obama signed The American Recovery and Reinvestment Act of 2009 which included the “Making Work Pay” Credit, which may be of particular interest to plan sponsors and pensioners. The attached memorandum summarizes the Credit details.
The IRS recently released revised Publication 15-T, with new wage withholding tables that incorporate the Credit. The new tables replace the existing tables in Publications 15 and 15-A, and must be used no later than April 1, 2009. The publication clarifies that the new withholding tables apply to pension payments.