Comments on: $400 or $800 Making Work Pay Tax Credit

By: Big Bootay

Big Bootay — Fri, 19 Mar 2010 20:39:11 +0000

Wait a minute!!

I was wrong!!

Here is a quote from Instructions to Schedule M.

“You may be able to take a credit of up to $400 ($800 if married filing jointly) if you have earned income
from work. Even if your federal income tax withholding was reduced during 2009 because of the credit, you must complete Schedule M and claim the credit on your return to benefit from it. You cannot
take the credit if the amount you enter on line 5 is $95,000 ($190,000 if married filing jointly) or more, you are a nonresident alien, or you can be claimed as a dependent on someone else’s return.

The credit is reduced if either of the following statements is true: .

You (or your spouse, if filing jointly) received a $250 economic recovery payment during 2009. You may have received an economic recovery payment if you received social security benefits, supplemental security income (SSI) benefits, railroad retirement benefits, or veterans disability compensation or pension benefits.

You take the government retiree credit discussed next.”

So – what happened to me was normal. I received lower withholding in 2009, and I received an $800 credit to my return.

The only unusual aspect is that IRS gave me the $800 credit even though I failed to file Schedule M.

Nice!

Sorry for the earlier post. I didn’t mean to confuse.

By: Big Bootay

Big Bootay — Fri, 19 Mar 2010 20:25:21 +0000

To implement Make it Work, IRS notified employers in Feb 2009 of reduced tax witholding amounts. Some employers changed their payroll systems to reduce the withholding, thereby increasing the amount of each employee’s paycheck. Some employers failed to do this. Employees of those companies did not receive bigger paychecks. The program was poorly advertised. Do you remember the amount of publicity behind the 2008 rebate program? IRS and .gov failed to generate the same type of publicity for the Make It Work program.

Therefore nobody knew about it.

IRS created Schedule M for filing and claiming the Make it Work tax credit.

Nobody knew about that either.

I didn’t. I’m married filing joint, wife does not work.

My employer lowered my withholding amount, thereby increasing each bimonthly paycheck I received in 2009 (Feb thru Dec) by ~$30. Yes, we noticed it.

I filed my 2009 return in Feb. I had never head of Schedule M (1040 Line 63), so I ignored it.

I just received my tax refund, direct deposited to my bank acount. It was for exactly $800 more than we expected.

I have since read that because of the confusion in publicizing and implementing the program, IRS is now providintg the $400 or $800 credit to everyone, regardless of whether Schedule M was filed or whether the employee received the 2009 withholding reduction.

This means my total benefit was $1658. My 2009 paychecks were each $39 higher for 11 months, or 22 paychecks. That’s $858. Then, they lumped on the other $800.

If my present understanding is correct, my benefit will be about double what my neighbor gets because his employer failed to make the withholding change back in Feb.

I anticipate that the IRS may discover this silliness at some point in the future and ask for the $800 back. I’ll probably tell them to pound sand.

My advice – don’t file Schedule M.

By: Perspective from Rationality

Perspective from Rationality — Thu, 18 Mar 2010 01:22:21 +0000

I sense that most of the people posting here are severely undereducated. With the Reinvestment and Recovery Act of 2009, the Obama Administration averted another Great Depression. Moreover, there has been no significant change in our Federal Income Tax. You are angry at the wrong targets.

By: jigrig

jigrig — Wed, 17 Mar 2010 13:16:47 +0000

But You are not tired of the thieves in office?

By: jigrig

jigrig — Wed, 17 Mar 2010 13:11:59 +0000

It means that You are going to lose either way because You will have to pay for Professional help, this is not me poking you in the eye with a hot stick, just the truth.
I believe that anyone who wants to be a politician should have to do 30 years hard labor “BEFORE” they even run for office.

By: jigrig

jigrig — Wed, 17 Mar 2010 13:04:05 +0000

I feel for you, I really do, back in 02 I was permanently disabled by an exterminator truck while stopped at a red light.
While not being wealthy I made $93,000.00 in 01 & to add insult to injury it turned out that the Ins. Co. for the exterminator was in bankruptcy leaving me to have to sue some state funded thing run by the state of NJ.
Needless to say I had to fight Social Security & my Companies Ins. Co. which happened to also be my auto Ins. Co, & by the time I got what I was allowed, it was all owed.
Anyhow, now I have monthly income from SS & my former employers Ins. Co., enough where I can pay my bills & still have a few beers now & then, Being single with no kids I can only feel sorry for all You folks & I mean it, The Government has screwed you so bad it is not funny.
I believe if they could read my mind they would assassinate me.
I remember Rudy ( 9/11 SUPERMAN) GAVE HIMSELF A A 35% PAY INCREASE WHILE DENYING THE NYPD & NYFD PAY INCREASES!
This has been the norm far too long, I wish I had the answers but I don’t.
God bless all You married with children People, I especially feel for Your Children.
If there is a God now would be the time to step in because the next step is Anarchy!

By: jigrig

jigrig — Wed, 17 Mar 2010 12:46:12 +0000

I’ll see Your two & raise it two!

By: Perspective From Texas

Perspective From Texas — Mon, 15 Mar 2010 15:08:36 +0000

It’s pretty simple. Whether your employer adjusted your tax witholdings each week or not, you still need to file a Schedule M with your tax return. My parents are retired and work part-time. They each recieved the $600 reduction in witholdings TWICE!!! Compound this adjustment to witholdings with the usual inconsistancies between two sources of income, and they owe a very large sum to Uncle Sam. However, I as an idividual with no dependants and only one source of income am getting a credit. Who’s happiest? They are! They got to hold onto their money and put it to use for themselves as it was earned and ONLY pay Uncle Sam what he’s owed. I, on the other hand, loaned our government a sizable sum intrest free over the past year.

By: job

job — Wed, 10 Mar 2010 22:02:59 +0000

I’m not seeing anything on my paychecks. I got nothing extra in my return. This is bogus.

By: Ed

Ed — Wed, 10 Mar 2010 16:42:32 +0000

Fools – it’s all fake money anyway – borrowed from the Chinese. Your gov’t is desperately trying to get you to go back to the good old days of spend, spend, spend by giving you back some of your hard-earned money. How long do you think this type of economy can continue? It’s all fake and will eventually collapse and when it does, your generous politicians will be taken care of while you will be left to scratch for a meal.