Stimulus farce, did you know this?

I was talking to a CPA about my stimulus money that i know get, about 60.00 a month and said it was nice to have a few extra bucks when he laughed and said you do understand the stimulus package only lowered the amount of withholding tax taken out it did not lower the tax itself. So he tells me I still will owe the same tax amount, so at 60.00 a month x 12 at tax time i will still owe the 720.00 they let me keep. So instead of getting a small refund i normally get i am now going to owe them money. He said 95% of the people dont know this and will be unpleasantly surprised come tax time. did you know this? I didnt till now and it sucks!

Workers
Making Work Pay Credit: Workers and the self-employed would get a payroll tax credit for 2009 and 2010 of up to $400 a year for single taxpayers, and up to $800 for couples filing jointly.

The IRS will get the money to taxpayers by adjusting the withholding tables, thereby boosting paychecks. The increase could be as much as $40 per month per worker, depending on when the withholding tables are changed. Self-employed workers will claim the credit on their tax returns. In the meantime, they can reduce their estimated tax payments for 2009.

For single tax filers, the credit will begin phasing out at an Adjusted Gross Income (AGI) of $75,000. For couples filing jointly, the phaseout zone will start at $150,000 of AGI. (Adjusted Gross Income is your total income from wages and other income minus certain adjustments, such as deductible IRA contributions and alimony paid.)




Your CPA is wrong Gunny. Your tax rates are not changing but you will take the $800 credit when you file your 2009 taxes.

good to know, i thought it sounded like there was more to it, hopefully we wont get screwed.

Guys I'm retired from GE. I got a little raise on my pension check the last couple months and thought that GE had given us old farts a raise. Then I got this in the mail from GE.

"To comply with the Making Work Pay Tax Credit Program (part of the Economic Stimulus Plan), GE implemented new tax withholding tables that may have reduced your Federal withholding beginning with your May pension payment. Even though your withholding may have decreased, YOUR ACTUAL TAX LIABILITY MAY NOT HAVE. This means you may owe additional Federal taxes at the end of the year".

Like I said, I got this mailed to me by GE. So I changed my W-4 to hold out the difference and hopefully I WON'T owe more at the end of the year. That's my plan anyhow.

Woodtick wrote:

Guys I'm retired from GE. I got a little raise on my pension check the last couple months and thought that GE had given us old farts a raise. Then I got this in the mail from GE.

"To comply with the Making Work Pay Tax Credit Program (part of the Economic Stimulus Plan), GE implemented new tax withholding tables that may have reduced your Federal withholding beginning with your May pension payment. Even though your withholding may have decreased, YOUR ACTUAL TAX LIABILITY MAY NOT HAVE. This means you may owe additional Federal taxes at the end of the year".

Like I said, I got this mailed to me by GE. So I changed my W-4 to hold out the difference and hopefully I WON'T owe more at the end of the year. That's my plan anyhow.

The reason for the disclaimer is if you make over $150K a year it is fazed out, but they still give it to you on your check. So Gunny you may not qualify.

Me & DD haven't noticed any change on our pay....I guess they didn't change anything on our end. We had to pay last year because they weren't cutting us enough, so we sign some papers to get cut more & still making the same amount as always.....so I guess we are paying again come tax time. At least I get my taxes done for free....my stepdad is a CPA.

Well, the guy was not "my" cpa just as i said, a cpa. I wont fall in the 150k range so maybe it will all work out.