Most taxpayers eligible for new tax credit
By Connie ThompsonSEATTLE -- Unless you had a very high income last year, you did not pay the full tax that normally comes out of your paycheck. MultimediaBy government order, your employer reduced your tax withholding as part of a stimulus program called "Making Work Pay." " 'Making Work Pay' is a credit that provided a way of putting more dollars in taxpayer's pockets to help stimulate the economy both nationally and locally," explained IRS spokesman David Tucker. But that means you still owe that unpaid tax. So, to cut you a break, you get a credit -- $800 for married couples filing jointly; $400 if you're single. "What the credit does is make sure you get the credit for that $400," Tucker said. "That means you'll have a $400 credit on your return." For example, if your total tax liability is $1,100 and your employer only withheld $600. A $400 "Making Work Pay "credit means you only own the IRS $100 when you file your return. Overlook the credit, and you could end up owing more than you need to -- or you could lose out on a refund. Say your total tax for 2009 was $800 and your employer only withheld $600. Taking that $400 "Making Work Pay" credit means you get $200 back, instead of having to pay $200. The IRS has special online withholding calculator to help you determine whether you qualify. Just remember, if you qualify, you have to file a Schedule M to make the "Making Work Pay" credit work for you. |
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February 9, 2012
- Roseburg, Oregon
