The tax decrease that really isn’t a tax decrease

The following is from the text of a memo that was attached to the payroll details for  all city employees, from the legal department. 

MEMORANDUM – March 19, 2009

Please be advised that as part of the American Recovery and Reinvestment Act of 2009 a new tax-withholding table has been released and must be implemented by the City of Albany by April 1, 2009. For most taxpayers the newly released tax-withholding table will result in less money being withheld from your paycheck each week for tax purposes. Thus, most employees will see a slight increase in their paychecks each week.

However, please be further advised that as of today’s date the government has not adjusted the tax brackets which determine the amount of taxes that will be owed by the tax payer each year based on their annual salary.  Therefore, the adjustment of the tax-withholding table may increase your tax liability. This liability can be offset by having additional money withheld from your paycheck each week.

The “tax decrease” stimulus is stunning in it’s deception, isn’t it?  I can’t really say anything else about this.

4 Responses to “The tax decrease that really isn’t a tax decrease”

  1. Lisa
    March 27, 2009 at 9:13 am #

    I can say something about it: GRRRRRRRRR!

  2. Michelle
    March 27, 2009 at 11:26 am #

    Um. Wow. Yikes.

  3. STB
    March 27, 2009 at 2:22 pm #

    I would say, that the second statement is likely designed as a disclaimer by the legal department, in order to indemnify their ‘organization from any legal responsibility, should an individual’s income actually DROP as a result of the increased pay. Everyone is so worried about being sued these days….

  4. April
    March 30, 2009 at 1:39 pm #

    Seems almost criminal in that the average tax payer will not realize the consequences until they go to file their tax return next year.

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