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corsair23
02-10-2010, 10:35 AM
Have I been living under a rock? I had never heard of the "Making Work Pay" tax credit until today when a coworker told me about it. He finished his taxes up last night and instead of owing $765 he is getting a $35 refund because of the $400 credit for both he and his wife ($800 total)...

I was doing some reading and from what I can tell everyone "should" have seen a decrease in the federal income taxes withheld that would be offset come tax time by this credit (i.e. the withhold less each paycheck and then use the credit come tax time to insure you don't owe in the end). Well, no one around here remembers a reduction in federal payroll taxes but we've all noticed an increase in federal income taxes this year :confused:

Anyone else heard of the tax credit, or finished their taxes and got the credit?

Here are some articles I found via Google search (sorry, some are "political" in there review but I was looking for concise explanations of the credit):

The Making Work Pay Tax Credit (http://www.irs.gov/newsroom/article/0,,id=204447,00.html)

"Making Work Pay" Credit Will Not Stimulate the Economy (http://www.heritage.org/research/taxes/wm2240.cfm)

The Making Work Pay Credit: Who Will Benefit? (http://www.taxfoundation.org/blog/show/24396.html)

$400 or $800 Making Work Pay Tax Credit (http://www.moneyunder30.com/400-800-making-work-pay-tax-credit)

AxleIke
02-10-2010, 10:42 AM
Yup. Got 750 back. I almost missed it. Good thing I know a future laywer and certified tax agent :D

EWheeler
02-10-2010, 03:07 PM
Thanks for this. I did not see any increase in take home income and our payroll had no idea what this was. I would much rather get the lump $400 than the incremental payments. The more money they keep from me the better, keeps me from spending it!!

60wag
02-11-2010, 05:45 AM
I use Turbotax and it calculated the credit for me. I went through the credit instructions several times to convince myself that it was applying the credit properly. It does seem like something that would have gotten more media attention.

Red_Chili
02-11-2010, 07:46 AM
Thanks for this. I did not see any increase in take home income and our payroll had no idea what this was. I would much rather get the lump $400 than the incremental payments. The more money they keep from me the better, keeps me from spending it!!
Interest-free loan to the government.
You can do much, much better to have automatic deposits made to a savings account. Same effect, but you pay YOURSELF interest that way.