Posted By metsfan on 05/08/2008 7:19 AM
LeonPotter, you are incorrect on the example of a married couple filing jointly with two kids. I'm not sure how you came up with the formula or math but it's much easier than all that. Since they fall under the max income of 150k they get $1200 as a couple and $300 per child for a total of $1800.
You're right I was mistaken. I based it on my understanding of tax liabilty. The item I misunderstood was NET tax liability. This is the TOTAL from line 57 (liability after deductions and credits) + line 52 child tax credit.
There are examples of why the maximum may not paid. Following are the items regarding net tax liability from IRS.gov "Many, but not all, taxpayers qualify for the maximum basic payment of $600 for singles or $1,200 for married couples. Many parents are also receiving an additional $300 for each qualifying child, born after Dec. 31, 1990. Your payment may be less than the maximum for one or more of the following reasons: - You are single and your net income tax liability is less than $600. If you file Form 1040 net income tax liability is the amount shown on Line 57, plus the amount on Line 52.
- You are married and your net income tax liability is less than $1,200."
I did sample scenarios using the online calculator and I was able to change the results based on changing the "net tax liablity" which supports the IRS info. Again, it's something that could be simple, but it's a political invention. It appears people with lower incomes will not get full rebate either. Here's why: The child tax credit (line 52) lowers the tax $1 for $1 until zero. But, if the taxpayer(s) already have no or low tax liability, the child tax credit will be limited to that amount. When lines 52+ 57 are added, the total could be less than maximum rebate allowed. The flip side of the coin is that I could have put more to 401k to lower tax liablity to zero(line 57) and still got $2100. I have three kids under 17. So my NET tax liabilty (line 57+ line 52) would have been $3000. |