Ask the taxgirl: Problems with New Tax Tables

Taxpayer asks:

“Rude surprise for taxpayers

Millions of people who are enjoying President Obama’s tax credit will need to return some of it.” http://finance.yahoo.com/news/INSIDE-WASHINGTON-Rude-apf-15091434.html?.v=1 Per the Yahoo News

I read the article and not sure what to believe. Are their problems ? Should we withhold extra to get the same amount back assuming all household/Income things stay the same as last year ?

Thanks,

Concerned about tax tables

Taxgirl says:

Apparently Yahoo and MSN were both late to the game on this one. I’ve received two questions this morning related to their articles.

This is not a new concern. It’s not that the tax tables are wrong – it’s that your individual circumstances cannot always be accounted for in a table. Some people will have circumstances that might cause them to get too much credit – you can read all about it in my prior post.

But it’s important to understand that this isn’t a flaw in the tables that’s just been discovered or a fluke that wasn’t previously accounted for – tax professionals have know about this for a bit now. I blogged it in March, as did many of my colleagues. Yahoo and MSN aren’t breaking news – they’re just playing catch up.

Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.

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Comments

  1. GT

    We get SSAN as well as military retirement pay. What I did when I found out that the tax withholding for the retirement pay was going to reduced by about 90%, I adjusted the elective withholdings up by that same amount and hopefully we will break even or get our usual refund.

    This “TAX BREAK” is a GOTTCHU from the current administration. They’ll give it to you now but they’ll take back more at the end of the year.

    As one of my old legal instructor said, “TANSTAAFL” pronounced STANAPPLE meaning, ‘There Ain’t No Such Thing As A Free Lunch.’

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