Federal Stimulus Relief for Individuals, Families and Small Businesses

The American Recovery and Reinvestment Act enacted new federal tax relief measures that will benefit many Missouri individuals, families and small businesses.

Benefits for individuals and families include:

  • Increase in pay due to reduced federal income tax withholding
  • One time payment of $250 to seniors, disabled veterans, retired teachers and others
  • Increase in the earned income tax credit for families with three or more children
  • Federal income exemption of the first $2,400 of unemployment benefits
  • Federal income deduction for state and local sales taxes paid on the purchase of new vehicles
  • Increase in the child tax credit
  • Increase in federal tax credit from $7,500 to up to $8,000 for first time homebuyers
  • Increase in federal tax credit from $1,800 to up to $2,500 for tuition and related expenses
  • Increase in thresholds for Alternative Minimum Tax

Benefits for small businesses include:

  • Reduced estimated tax payment requirements for 2009
  • Extension of net operating loss carrybacks from two years to up to five years
  • Deferral of cancellation-of-debt income
  • Expansion of Work Opportunity eligible target groups to include unemployed veterans and disconnected youth; employers are eligible for a federal tax credit of up to $2,400 of wages paid to employees in these groups
  • Accelerated depreciation for qualifying property
  • Increased expensing for qualifying property
  • Extension of acceleration of recognition of historic alternative minimum tax and research and development credits
  • Exclusion of gains from the sale of qualified small business stock held for required periods

The Worker, Homeownership, and Business Assistance Act of 2009 provides additional benefits for individuals and small businesses.

Benefits Include:

  • Extends the homebuyer credit to April 30, 2010, expands the definition of who qualifies, and adds anti-fraud measures
  • Mandatory electronic filing for certain tax professionals
  • Extends the five year carryback to losses occurring in 2009 and expands this carryback provision to businesses of all sizes

Click here for more information related to the benefits.