How Will the Economic Stimulus Plan Affect Your Business?

Summary of Selected Payroll Related Provisions

Certain aspects of the recently-enacted Economic Stimulus Plan will affect payroll processing and business services supplied to you by PrimePay. Rest assured that PrimePay is aware of these changes and will make sure your payroll complies with the new requirements. As a service to clients we have compiled the following summary of the Economic Stimulus Plan's effect on payroll taxes and COBRA health coverage that could affect you as an employer.

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What is the Economic Stimulus Plan?

The American Recovery and Reinvestment Act of 2009 ("Stimulus Bill" or "Act", Pub.L. 111-5, H.R. 1, S. 1) was approved by both houses of Congress and signed into law by President Barack Obama on February 17, 2009. The Stimulus Bill is intended to provide a boost to the U.S. economy in the wake of the economic downturn brought about by the subprime mortgage crisis and the resulting credit crunch.

The new law includes federal tax cuts, expansion of unemployment benefits and other social welfare provisions, and domestic spending in education, health care, and infrastructure, including the energy sector. The Act also includes items that are not directly related to the economy, but were viewed by Congress as necessary parts of longer-term plans. While many opinions can be heard about the Stimulus Bill in Congress, among economists and throughout the country, few can doubt the sweeping scope of this $787 billion spending bill. This money will be allocated as indicated in the table below:

Please note, the information on the Economic Stimulus Plan is believed to be accurate and was gathered from sources believed to be reliable, but it is not intended to be relied upon as tax or other advice to specific clients. Companies seeking more detailed advice specific to their situation are encouraged to contact their CPAs or other professional advisors.