Payroll tax cut signed into law
Yesterday, President Barack Obama signed the payroll tax cut into law without ceremony in the privacy of the White House.
The provision will extend the 2 percent reduced rate in the tax that funds Social Security. Along with continuing the reduced payroll rate, the law extends unemployment benefits up to 73 weeks and prevents the rate of reimbursement to doctors that treat medicare patients from being reduced.
The $143 billion plan was passed by Congress last Friday after long-winded negotiations. House Democrats and Republicans struggled over the bill, which was set to expire at the end of February. Negotiations centered around how the government would pay for the bill's high costs.
Many Americans will benefit from the extra take-home pay as a result of the legislation. Workers earning $50,000 per year will get an extra $80 per month as the result of the extension, the administration estimates. For employees that earn more, it could add up to $2,200 per year.
"More people spending more money means more businesses will be able to hire more workers, and the entire economy gets another boost just as the recovery is starting to gain some steam," Obama said. "So Congress did the right thing here. They listened to the voices of the American people."
The provision will extend the 2 percent reduced rate in the tax that funds Social Security. Along with continuing the reduced payroll rate, the law extends unemployment benefits up to 73 weeks and prevents the rate of reimbursement to doctors that treat medicare patients from being reduced.
The $143 billion plan was passed by Congress last Friday after long-winded negotiations. House Democrats and Republicans struggled over the bill, which was set to expire at the end of February. Negotiations centered around how the government would pay for the bill's high costs.
Many Americans will benefit from the extra take-home pay as a result of the legislation. Workers earning $50,000 per year will get an extra $80 per month as the result of the extension, the administration estimates. For employees that earn more, it could add up to $2,200 per year.
"More people spending more money means more businesses will be able to hire more workers, and the entire economy gets another boost just as the recovery is starting to gain some steam," Obama said. "So Congress did the right thing here. They listened to the voices of the American people."
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