How much more evidence do we need before deciding Barack Obama and his administration are completely incompetent? They can’t even get a tax cut right.
New York Daily News Reports:
More than 15 million taxpayers could unexpectedly owe taxes when they file their federal returns next spring because the government was too generous with their new Making Work Pay tax credit.
Taxpayers are at risk if they have more than one job, are married and both spouses work, or receive Social Security benefits while also earning taxable wages, according to a report Monday by the Treasury Department’s inspector general for tax administration.
The tax credit, which is supposed to pay individuals up to $400 and couples up to $800, was President Barack Obama’s signature tax break in the massive stimulus package enacted in February.
[...]
The withholding tables, however do not take into account taxpayers with multiple jobs or married couples in which both people work. They also don’t take into account Social Security recipients with jobs that provided taxable income.
The Social Security Administration sent out $250 payments to more than 50 million retirees in the spring as part of the economic stimulus package. The payments were meant to provide a boost for people who didn’t’ qualify for the tax credit.
However, they went to many retirees who also received the credit. Those retirees will have the $250 payment deducted from their tax credit – but not until they file their tax returns next year, long after the money may have been spent.
“While implementing a credit through reduced withholding is an effective way to provide economic stimulus evenly throughout the year, it is difficult to account for everyone’s circumstances,” said J. Russell George, the Treasury inspector general for tax administration. “More than 10 percent of all taxpayers who file individual tax returns for 2009 could owe additional taxes.”
The tax credit is also available for 2010. Russell said the problems will continue in 2010 if they are not resolved. …..
I can think of several dozen people I know off the top of my head this will effect, including ME!
H/T Daneen
Mistake? It’s no mistake.
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