Oh glorious love of Christ my Lord Divine,
That made Him stoop to save a soul like mine;
Through all my days and then in Heaven above,
My song will silence never, I'll worship him forever,
And praise Him for His glorious love.
("Oh Glorious Love" by the Talley Trio)
OK, I admit, I'm only a first year tax preparer, so you should triple check the facts with YOUR tax professional, BUT!!!! there are some hinky things you ought to be aware of regarding this year's taxes with respect to this idiotic bailout:
the "Making Work Pay" credit
This looks like it might be an adjustment (temporary) to the percentage on what is withheld on your federal taxes. This would adjust take-home pay a little bit to total up to $400 for single filers and $800 for married filing jointly (MFJ) based on income. Don't forget - as with most tax credits - there are phaseouts on income amounts, in this case beginning at $75k (single) and $150k (MFJ).
However, in my training yesterday, this raised concerns for how it would affect your refund or amount owed on next year's taxes. It is possible that for lower income taxpayers, they MAY see a slightly lower return next year due to this credit, and it's possible that higher income taxpayers MAY see a slightly higher amount owed next year if their withholding is affected.
I am not saying this will certainly happen, but for my readers' benefit, I would strongly suggest that you keep a careful eye on this, and perhaps see if the pay department at your job can give you better information. If they can't tell you, you might consider trying to advise them to keep your withholding at the current standard federal rate and worry about taking the credit when you file your 2009 tax return.
This is also important, because the Making Work Pay credit also affects
the Economic Recovery Payment
The ERP is a one time payment of $250 to individuals who receive
Veterans' Administration pension or disability benefits
At this time, what it looks like is that, IF you are working AND you receive some of the benefits above, your total "payback" from the government, your total credit between the ERP and the "Making Work Pay" MAY only be the $400 (single).
For instance, if you are an unmarried mechanic with a regular job and also receive VA disability benefits, your MAXIMUM credit would be $400, even though the MWP and ERP credits/payments would add up to $650.
LEGAL DISCLAIMER: Again, this is what appears to be happening with the tax information I have NOW. I am NOT speaking on behalf of any tax preparation entity, neither am I offering guaranteed "official" advice. As I have already said, you should consult with your own tax professional to see how this affects your personal tax situation.
First, go watch this video (wish I could embed it)
CNBC's Rick Santelli and the traders on the floor of the CBOE express outrage over the notion they may have to pay their neighbor's mortgage, particularly if they bought far more house than they could actually afford
I am totally onboard with this; my sentiments are accurately expressed by the first commenter I read at the poll's page:
The plan is a discrace! I pay my mortgage and bills on time. I live on a fixed income. I find it tough each month to make ends meet, but do. I did not go out and buy a home I could not afford. No one is helping ME! The Bleeding heart Democrats might as well give the country away. God Bless Rick Santelli!!
Robin Hood taxation: rob the hard working, productive people, and redistribute the wealth (AFTER the government takes its cut, of course) to those who lived beyond their means and were fiscally irresponsible... Whoa, just like the government!