Feb 18, 2009 11:25 pm US/Central
Reality Check: Tax Breaks For People Who Don't Pay
(WCCO)
With this stimulus plan, President Barack Obama has promised to help Americans who need it most. And that means tax breaks for poor families, even if they don't pay income taxes.
By the time you are doing your taxes next year, things will be different.
The economy might not be better, but you'll be getting a little more help because of the
economic stimulus package Obama signed on Tuesday in Denver.
The bill fulfills a controversial promise Obama made during the campaign to help Americans who need it most. Tax breaks for poor families -- even if they don't pay income taxes.
That includes nearly
half a million Minnesotans who live in poverty.
And Obama's stimulus plan sends many of them government checks -- even if they make so little money they don't pay income taxes.
It's TRUE.
Minnesota families earning as little as $3,000 don't owe taxes, but they can get stimulus checks. The president is using something called "
refundable tax credits" to help them.
They are tax credits available to everyone else, but turn into refunds for people who don't owe taxes.
It's TRUE.
Minnesota families earning up to $22,000
don't owe taxes, but they can get stimulus checks.
Here's what you NEED TO KNOW.
Families in poverty are not always entitled to child tax credits. And 6.3 million poor children in America were denied those benefits entirely last year.
Now,
their families can subtract $1,000 from their tax bills for every child in the house, and that adds up to refunds.
And there's MORE.
A new
tax credit for workers: $400 for individuals; $800 for couples. That's for all workers, even if they are too poor to owe taxes.
Here's the REALITY.
Poor people pay taxes, too, even if they
don't owe income taxes. They pay sales taxes, payroll taxes and social security taxes. Some are calling it a redistribution of wealth.
Even so, it could put
thousands of dollars in the pockets of those struggling families.
That's Reality Check.
To check the resources for this Reality Check, click on the links below.
Recovery.Org
Minnesota Census Facts
Refundable Tax Credit and Non-Refundable Tax Credit
Minnesota Tax Incidence Studies
Recovery Agreement Temporarily Expands Child Tax Credit
New York Times: The Stimulus Plan: How to Spend $787 Billion
IRS: What's New For 2009
Individual Income Tax Credit Is Biggest Chunk of Stimulus Plan
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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