More Incompetence from the Treasury
This is from an article from the AP:
Millions of Americans enjoying their small windfall from President Barack Obama’s “Making Work Pay” tax credit are in for an unpleasant surprise next spring.
The government is going to want some of that money back.
But new tax withholding tables issued by the IRS could cause millions of taxpayers to get hundreds of dollars more than they are entitled to under the credit, money that will have to be repaid at tax time.
At-risk taxpayers include a broad swath of the public: married couples in which both spouses work; workers with more than one job; retirees who have federal income taxes withheld from their pension payments and Social Security recipients with jobs that provide taxable income.
The Internal Revenue Service acknowledges problems with the withholding tables but has done little to warn average taxpayers.
I guess that’s what happens when you put a guy who can’t even manage to do his own taxes as the head of the Treasury.
The American Federation of State, County and Municipal Employees union raised concerns about the effect of the tax credit on pension payments in a letter to Treasury Secretary Timothy Geithner in March.
Geithner responded that Treasury and IRS understood the concerns and were “exploring ways to mitigate that effect.”
Rep. Dave Camp of Michigan, the top Republican on the tax-writing House Ways and Means Committee, said Geithner has yet to respond to concerns raised by committee members.
“So far we’ve got the, ‘If we don’t address this maybe it will go away’ approach,” Camp said.
That’s great, they screw up and then they don’t even let anybody know. We could have just sent out checks to everybody and been done with it. Now we have lots of people getting accustomed to having more money and many won’t know what to do when it gets taken away after the tax credit runs out. We also have millions more who are actually getting more than they are supposed to who are going get hit with an unexpected tax bill next April.
Remember what Reagan said the nine scariest words in the English language are, “We’re from the government, and we’re here to help.”