Returning $$$ back for stimulus checks

[EweSheep]

I guess we didn't see this coming.....in very small print that it has to be repaid! Why didn't they give us an option to choose whether or not, we want the check or not?

For sure, next time the gov't gives us a check like that, give it back to them and say NO THANKS!

 

[Mac in Wisco]

I keep track of our withholding so that it balances at the end of the year. I forecast what we will owe in and adjust withholding as necessary so I am not giving the government a loan for the most of the year, nor end up paying too much extra at the end of the year.

This only affects those families that have two or more jobs. For a two income family they took about $400 less than what you will actually owe. As most families get a something of a refund each year, I would suspect that it won't hurt them much, except for a lower refund.

 

[HLAC]

To the credit of my main employer, they sent out a letter when the 'stimulus' went into effect. Since many of us that work for the company have multiple jobs they warned us about the possible double withholding and the need to expect to cough up more cash than expected at tax time.

I usually end up owing a bit anyhow (why should the gov. hold my money, they aren't paying interest?) and am prepared to pay the government even more this year. -sigh-

 

[Mac in Wisco]

Quote:
This isn't about the stimulus checks that we have received in the past. The last stimulus provided a tax credit. To get the money into peoples pockets right away instead of at the end of the year they lowered the withholding rates. You probably saw $50 a month extra in takehome pay a month since they started this in April or May. If you and your spouse both worked, you both reaped the benefits of the lower withholding for the year, but the tax credit doesn't quite add up to the amount that wasn't withheld.

Like I said for most people in this situation they will just see a lower refund because not enough was withheld for those people. The headlines that say it has to be "repaid" are misleading. The stimulus tax credit didn't change, it's just that some saw a larger benefit in their household incomes over the course of the year and it will be adjusted in the end.

 

[Mac in Wisco]

Quote:
That's not correct. The stimulus tax credit, is still a tax credit. Each person who holds a job will pay $400 less in taxes this year. $800 for married couples if I recall correctly. Bottom line is that we are paying less in taxes this year. The problem was in the withholding rates. A working couple probably saw $1200 put back into their paychecks over the course of the year. With an $800 tax credit for them that means there is $400 difference that needs to go back to the feds. As most people get some sort of refund at the end of the year, those couples affected will see about $400 less in their refund, but they still received an $800 tax credit!

 

[BarbK]

Quote:
This isn't about the stimulus checks that we have received in the past. The last stimulus provided a tax credit. To get the money into peoples pockets right away instead of at the end of the year they lowered the withholding rates. You probably saw $50 a month extra in takehome pay a month since they started this in April or May. If you and your spouse both worked, you both reaped the benefits of the lower withholding for the year, but the tax credit doesn't quite add up to the amount that wasn't withheld.

Like I said for most people in this situation they will just see a lower refund because not enough was withheld for those people. The headlines that say it has to be "repaid" are misleading. The stimulus tax credit didn't change, it's just that some saw a larger benefit in their household incomes over the course of the year and it will be adjusted in the end.

This is BarbK's Mom again. The above is referring to the change in payroll withholdings. This is different than the actual stimulus money that was received. This simply lowered the amount being withheld from your paycheck each pay period. For many people this may very well lead to having a balance due when you file your taxes, or at least a smaller refund from your tax return. There should have been a better explanation of this when it was put into place. This is not an actual payback, but less being taken, so possibly more owed at the end of the year. I have not yet seen the final tax return for this year, so I am not sure just how big of an issue this is going to wind up being. gdk

 

[EweSheep]

Quote:
This isn't about the stimulus checks that we have received in the past. The last stimulus provided a tax credit. To get the money into peoples pockets right away instead of at the end of the year they lowered the withholding rates. You probably saw $50 a month extra in takehome pay a month since they started this in April or May. If you and your spouse both worked, you both reaped the benefits of the lower withholding for the year, but the tax credit doesn't quite add up to the amount that wasn't withheld.

Like I said for most people in this situation they will just see a lower refund because not enough was withheld for those people. The headlines that say it has to be "repaid" are misleading. The stimulus tax credit didn't change, it's just that some saw a larger benefit in their household incomes over the course of the year and it will be adjusted in the end.

This is BarbK's Mom again. The above is referring to the change in payroll withholdings. This is different than the actual stimulus money that was received. This simply lowered the amount being withheld from your paycheck each pay period. For many people this may very well lead to having a balance due when you file your taxes, or at least a smaller refund from your tax return. There should have been a better explanation of this when it was put into place. This is not an actual payback, but less being taken, so possibly more owed at the end of the year. I have not yet seen the final tax return for this year, so I am not sure just how big of an issue this is going to wind up being. gdk

Barb's Mom
It would be a big issue and hope the politicians would realized how bad the ecomony is going to be when we were mislead by their vague instructions. Had they informed us if we need to be paying them back, I am sure alot of them will return the money and say thanks for the offer but I do not want it.
I dont know how Tax Preparers are going to confront the clients about this mess. Or the online tax preparer that some of us file taxes online.

I am very sure we are going to have a very small refund if we are to pay it back. On hubby's check stub, he claimed three of us for his taxes on both part time jobs (one year round and the other one was seasonal). Now he only has one job so far since the seasonal job was finished in Jan of this year.

 

[BarbK]

She is dreading the new clients this year. It is a hastle because people think she has the authority (because she does taxes) to make exceptions and so on. She does try to inform all of her clients about anything that will affect them. Luckly many of her clients will not be hit by a suprise. Unfortunatly so many others are. BarbK

 

[EweSheep]

Next time we have to remember to be nice to the tax preparers!

 

[greyhorsewoman]

As a former payroll clerk, I can attest that this is not a NEW problem. It occurs any time tax schedules are changed for changes in the tax laws. It is each individual's responsibility to determine whether their withholding is appropriate for their total annual income. Two full time wage earners, unemployment benefits, other taxable supplemental income should be calculated as a total. Tax tables assume that the the 'bracket' will be what the total of that individual's declared status is.