Below is some important information on the "Making Work Pay Program"

Please note that the information provided below is for reference only. This is a reprint of information that was provided to Lodge #35 and does not reflect the opinion of Lodge #35 nor any of it's members. Please perform your own research to make an informed opinion on this matter.


The Making Work Pay Tax Credit was a provision included in the stimulus package called the American Recovery & Reinvestment Plan and created a refundable tax credit to workers in 2009 and 2010.

The Making Work Pay Credit

in tax years 2009 and 2010, The Making Work Pay provision provided a refundable tax credit of up to $400 for individuals and up to $800 for married filing joint returns. Many employees received the credit throughout the year in the form of lower withholding from their paychecks.

Making Work Pay Credit Expires

The Making Work Pay tax credit was authorized for two years and expired on December 31, 2010. With the expiration of the Making Work Pay tax credit, the tax tables reverted back to where they were prior to when the Making Work Pay Credit went into effect in 2009.

Many Negatively Affected by Tax Credit Expiring

In 2011, employees' Social Security contributions have been reduced from 6.2 percent to 4.2 percent. This contributions cut will provide tax relief for millions of Americans and will offset the Making Work Pay $400 or $800 tax credit that expired in 2010 for most individuals and families.

However, for many lower income workers, the 2 percent Social Security contributions cut does not offset the expiration of the Making Work ay tax credit. These individuals will pay higher taxes in 2011 than they did in 2009 and 2010.

Additionally, many state and local government employees pay into local pension plans and do not make Social Security contributions and therefore do not receive the Social Security contributions reduction. These individuals will also pay higher taxes in 2011 as a result of losing the Making Work Pay tax credit and not receiving the Social Security contributions cut.