Today I love the IRS

[Toby'sFriend]

There was a big push in the 1990's to educate employers and recipients on the Earned Income Credit and also how to receive the monies in advance through your paycheck -- no need to wait until Filing a Tax Return to get the money.

I think the number of people that qualify but don't claim it is under 20% now. Most of those are people who do not file tax forms at all for one reason or another. Usually if they fill out their tax forms, they will claim the credit.

 

[Alicnwondrln]

It might be chump change to you, but I don't consider almost 180 billion chump change. It's more than is given for the Child Tax Credit $173 billion (which more people qualify for) and the $158 billion cost to taxpayers for charitable contributions.

# The earned income credit.
You qualify for the earned income tax credit, which is targeted at low-income taxpayers. Cost to the government: $179.7 billion.

http://moneycentral.msn.com/content/Taxes/Taxshelters/P75680.asp

WOW thats alot of $$ !!

 

[PBader]

I am sorry this is so long.........................

I think that EIC has a place in our society. It helps many families and single parent households. Yes, some people will abuse the system (this is true in everything). But it also helps a great many families that live on less than the median income. People can chose to have their EIC added to their weekly paycheck or receive it at tax time. Personally we own 2 businesses (gas stations) and none of my employees chose to receive the EIC weekly on their check. I wish I could pay all of my employees $35-$40K a year--can't afford it. Now maybe I would be able to pay more if we could find a way to stop shop lifters and gas drive-offs. (drive offs alone in 2005 were over $10,000--I would have to pump an additional 100,000 gallons of gas to recoup this)

There are roughly 3 out of 25 of my employees that receive this. I do not begrudge them of their benefit. They are very nice hardworking single mothers that struggle raising their families. They work 40 hour + weeks averaging $10-$16 per hour. They do not have a support system so when daycare will not keep their their child due to illness, they end up missing work and then have to struggle harder the next week to make ends meet. Some of them receive no child support for their children.

I have one SM that has worked for me for 3 years. She has received sub. housing for her and 2 DS. In April 2005 she became a manager for me, she has lost her subsidy because her income has risen. She is banking her EIC so that hopefully she can put a down payment on a house. I do not see a thing wrong with this. She is bettering herself and the future of her family. But she needed a start.

Yes it would be a wonderful world if every person would be able to make enough money so that this credit was not necessary, but it is not the case and never will be. You have many families where you have SAH moms and the DH works 2 jobs to make this happen. You also have people that work 2 jobs just to make ends meet.

It is a sad fact that there are many people that have to work an additional part time job in addition to their full time job in order to pay bills or to afford to have some "luxuries" that many of us take for granted. You can look around at people you know and love and wonder how in the world they spend money on what they do. There are savers and people that are so extended in credit. But it is not our place to judge them. You can provide advice (if asked for), but we can not tell people how to live their lives. It is just the way things are.....and will continue to be.

I know that that the EIC costs our government a lot of money, but it is a way to help families that work (earn an income). EIC is based on a graduated scale--you need to fall somewhere in the middle to collect the most money and that is not going to be done by working 2 or 3 months out of the year. Yes you do have people that live together and beat the system . It is cheaper on the government than welfare (where they sit at home and just collect money) Yes people will abuse the system and not see a thing wrong with doing that. But that is true in every aspect of our lives.

Hopefully most families use it as a building block and work to improve their situations so that they don't end up relying on it until their children are grown. Just imagine the surprise and regret some people face when say they have received this for x amount of years and finally finish school or get the "better" job and no longer quailfy. They still work just as hard but their income is no longer subsidised. Their "pay raise" that they were so proud of is a wash. My friend used to receive day care assistance ( around $40 per week)--she got an hourly increase of 50c ($20 per week) and lost her childcare assistance because she made too much money.

Our federal, state programs and tax codes are broken. But they work the best they can. Can they be "improved"--yes but we can not get both sides of our political system to work together to make changes that will help all Americans.
Paula

 

[Alice28]

We're getting a LOT of money back in taxes this year, AND the EIC.

Nope, we're not welfare folks. Would you believe we don't even get foodstamps! Gasp! AND we pay our bills on time, and golly, even have 529s set up for our kids.

My DH busted his butt this year in Iraq on active duty and we have 3 kids. We got the EIC. We're getting $5K back. And we deserve every freaking penny. That's the way the tax code is written, and that is how we are benefitting from it, and I'm sorry if some of you feel we are TAKING from you. I feel like my family gave everything we had this year, and if we want to play a little bit with our tax money, that's a welcome relief from the 17 1/2 months I have had with DH being gone.

Enjoy your new sofa and stereo OP! I know we are enjoying some of life's little luxuries ourselves with this money.

 

[tiggersmom2]

IIRC a few months ago she was complaining that she got turned down when she applied for Heat Assistance

I remember that vividly. I will echo that EIC is a glorified welfare check.

 

[Christine]

I don't have a problem with people getting the EIC. I think PBader explained it all beautifully.

My problem, and probably the subject for another thread, is that I'm jealous.

Okay, as many of you have probably heard me whine in my other thread--I pay A LOT of taxes. I also live in an "expensive" area. If I told the other poster what my DH and I made, she would probably wish she had my income. Now, I don't want to give it back by any means, or work a $10 an hour job. I think what makes people bitter is that we send such a large portion of our income to taxes, that we aren't really left with a lot of "net pay." I have the same issue as the OP. It's hard for me to come up with the money for my $300 heating bill. If I even went in an tried to apply for heating assistance, I would be laughed out of there.

I don't have an LCD TV, I don't have a new sofa, and I couldn't even consider getting new sound systems in my car because my income is just gone. Yep, a $21,000 tax bill this year. I want some of the luxuries too. I would like $3,500 back so I can take my kids to Disney World. I went last year--the first time since 2000. I won't be able to take another vacation again until next year (2007) because it drained most of what I had. And that's not a Disney vacation--it might just be to our local beach.

So, when I read stuff like this, it's a real bitter pill to swallow. I know we can never tell people how to manage their money but that doesn't stop it from being bothersome. If you gotta ask for heating assistance, it's not wise to blow your EIC.

 

[mudnuri]

Some of these posts make me laugh. Not that I feel I need to explain myself- but here's some info that might open some of the closed eyes and minds.

I'll start with what I can remember reading as questions first.

1st- the fuel assistance- yup, got denied. Why? Because I made too much, yet there are neighbors of mine who cheat the system and get their fuel paid for by the state...I on the other hand- prebought my fuel, BEFORE being denied the fuel assistance. I'm not saying because they cheat I should get it...point is- denied- too much $$...

2nd- I'm a full time college student, with custody of my 2 DD's. I work every other weekend- my choice- and live basically off my student loans and child support- and money that I had saved prior to going back to school. Another reason I was denied fuel assistance.

3rd- my children nor I recieve anything from the state or federal government, except- my Federal Pell grant....no food stamps, no fuel assitance, no subsidised housing...no federal or state medical coverage.

4th- my children have very nice college funds compliments of their fathers family. When each business was sold- stocks were split into the grandkids names, and they will be able to attend whatever college they choose- or at least pay for whatever college they choose.

5th- I do not carry any debt. The only bills that I have are monthly bills, my credit cards are paid off each month, and I no longer have car payments. I do not have anything in collections, nor do i ever plan to.

6th- I think of the EIC as money that I have paid in over the past 10 or so years, and not gotten back due to the X's income levels and business gains...trust me on this- it's not a huge amount of money...And from looking at my w2's I actually paid in more than 3/4 of the amount I'm getting back...so saying its yours- ha, wrong...

7th...the muhahahhahahaha was pure excitement. I don't buy myself anything, preferring to wait until income tax time and spend what usually is a small refund on myself. Yes, the LCD tv is not a necessity, but its also not a 56 inch plasma...the sectional- needed...not a luxury. My hand me down love seat has lost all support, and needs to be replaced. My stereo in my Passat- yeah, probably dont need that either, however...since all I'm doing is buying the component, and my DBF is installing it...its not really as much money as you all jump to the conclusion that it is.

8th...the funniest part about the dis is that we have a holier than thou attitude here. Everyone is so quick to judge everyone else, but yet they dont take the time to stop and think about what each posters situation is. Not everyone that receives the EIC is living off state assistance and screwing the system out of money. There are MANY EIC recipients that I know that do work full time, and are barely making it.

9th...no boyfriend living here helping me cheat the system.

10th...the passat is used. I sold my 04 Envoy when i went back to school, to eliminate my debt. See- I didnt file bankrupcy and then not owe anyone anything....I actually sold the Envoy for 1500 less than I owed...to get out from under it before I ended up in money troubles...imagine that....

11th- for those of you who didnt bash me, or others who received the EIC...thanks...for those of you who did...welllll this is a family board, and i just cant say what i really want to say. Taxcut did my taxes, and if it says I'm due 1500 or 7500 or whatever in a refund...would you prefer i call the IRS and tell them I'm not worthy of their refund....yeah like thats gonna happen!

Brandy

 

[Alicnwondrln]

 

[Free4Life11]

Welcome to the dis where all the women are perfect, the men carry no debt, and all the children are above average

 

[OhMari]

I just want to say, "Michigan-your income tax papers are the pits. My dd goes to school in the UP and works for the YMCA and school, but lives and works at home in the summer.

I have never done such a confusing form in my life.

Just thought I would change the subject-a tad, sorry OP.

 

[Free4Life11]

Some of these posts make me laugh. Not that I feel I need to explain myself- but here's some info that might open some of the closed eyes and minds.

No need. Good for you for taking the credit! It's there, you qualify, and you'd be stupid NOT to take it! And for those of you who were never in a position where you qualified for the credit, consider yourself lucky. If you don't like it, call up your Senator and tell him what you think. As long as the EITC exists, I wont knock ANYONE who takes it!

And for the record, I don't think the only people who "work the system" are the poor. I'm sure there a quite a few rich people out there who know how to shielf their income so that they pay the least amount in tax possible. It's perfectly legitimate and so is the EITC.

8th...the funniest part about the dis is that we have a holier than thou attitude here. Everyone is so quick to judge everyone else, but yet they dont take the time to stop and think about what each posters situation is. Not everyone that receives the EIC is living off state assistance and screwing the system out of money. There are MANY EIC recipients that I know that do work full time, and are barely making it.

Agreed.

 

[BuckNaked]

No need. Good for you for taking the credit! It's there, you qualify, and you'd be stupid NOT to take it! And for those of you who were never in a position where you qualified for the credit, consider yourself lucky. If you don't like it, call up your Senator and tell him what you think. As long as the EITC exists, I wont knock ANYONE who takes it!

I'm not going to knock people that take it, but I will knock the fact that it exists. There is absolutely no reason that someone should get back MORE from the government than they had withheld from their paychecks. And both of our Senators and our House representative have been told what we think of it.

It's perfectly legitimate and so is the EITC.

Just because it's legal doesn't mean it is legitimate or right.

There are a few posts on this thread where posters claim they "deserve" a government hand out, and I see a problem with that as well. No one "deserves" handouts, what they "deserve" is their pay and any benefits their employer chooses to give them.

 

[bettyann29]

Welcome to the dis where all the women are perfect, the men carry no debt, and all the children are above average

you just dont know how true this statement is.. at least thats what some would like others to think..

OP-- sorry you felt the need to justify yourself.. There is nothing wrong with recving these benefits.. if you are eligible for them there is nothing wrong with getting what you are eligible for.. Enjoy your spending..

 

[Free4Life11]

Just because it's legal doesn't mean it is legitimate or right.

le·git·i·mate:
1. Being in compliance with the law; lawful

 

[poohandwendy]

le·git·i·mate:
1. Being in compliance with the law; lawful

LOL, much like many words on our language the word legitimate has more than one meaning...

le·git·i·mate:
3. well-founded: well reasoned and sincere

 

[Free4Life11]

LOL, much like many words on our language the word legitimate has more than one meaning...

le·git·i·mate:
3. well-founded: well reasoned and sincere

Yep, just like I said, it's legitimate.

 

[poohandwendy]

As to the actual subject, I do not think that anyone should end up not paying any federal income taxes. And I think it is really wrong that there are people who end up getting a refund that not only reflects zero taxes paid, but walking away with bonus money.

I don't blame people for accepting the refund, but I think the system is seriously screwed up for allowing it.

 

[vivilasvegas]

LOL, much like many words on our language the word legitimate has more than one meaning...

le·git·i·mate:
3. well-founded: well reasoned and sincere

It is my legitimate wish that I could qualify for the EIC.

I supposedly earn enough money, but it sure seems to go fast!

 

[poohandwendy]

Yep, just like I said, it's legitimate.

In your opinion, of course...

 

[Free4Life11]

In your opinion, of course...

Of course. And we all know who's opinion is most valuable...