What Tax Credit?
More than 15.4 million Americans soon could learn that what the tax man giveth, the tax man can take away.
Those people, surprisingly, could owe taxes for 2009 because of complications in the Making Work Pay tax credit, a cornerstone of the $787-billion economic stimulus package enacted in February, according to a government watchdog report released Monday.
More than 1.2 million of them could face Internal Revenue Service penalties, at least technically.
"It definitely is going to be a surprise to some taxpayers, who are either going to have a balance due or a reduced refund this year," said Melissa Labant, technical manager on the tax staff of the American Institute of Certified Public Accountants. "I'm concerned about those people who are spending those refunds, which in fact they might not be going to receive."
About 1 of every 10 people who file taxes, particularly those with more than one job, might have had too little withheld this year, meaning they have to make up the difference by April 15, according to the report by the Treasury Department's inspector general for tax administration.
I don't know about you all but I pride myself on knowing a setup when I smell one. How could we pay for the FHA bailout with no one (except the usual suspects) buying Treasurys?