The TaxProf notes that the Tax Policy Center says 47% of households will pay no income tax this year. He……

Effective 2009 parents can get earned income credit on three children instead of two. The child tax credit is refundable with just $3500 income.
Therefore a person earns about $10,000 will get a refund on tax return almost as much as they made “working” all year. And someone actually believes that person paid the $750 worth of social security taxes? And someone actually believs that person paid the sales taxes through out the year?

We have had terrible corruption for many years over the democrats socialist earned income credit. We have had a situation encouraging parents to not be married for many years, as a result of the same programs. Now for the year 2009 with the new program on 3 children, the corruption will again go up exponentially.

Jeff Day

If you mean that your income is below the federal poverty line, then your federal income tax burden should be less than or equal to zero.

Last year, the federal poverty line was $10,400/year for a one person household, and it went up by $3,600 for each additional household member, so it would be $21,200 for a family of 4.
http://aspe.hhs.gov/POVERTY/figures-fed-reg.shtml

The exact calculation for a household will depend on marital status, age of children, etc. but it’s really hard to see how anyone officially below the poverty level could have a large income tax bill.

That said, the poverty level is a highly flawed criterion in many ways. For example, it doesn’t take into account the cost of living in different areas. It’s much harder to raise a family of four on $21,200 in NYC than in rural Mississippi, for example. The poverty level also doesn’t take into account whether or not a person has high medical costs, health insurance status, and other important factors.

If you meet the criteria for VITA assistance (simple tax circumstances and income under $42,000 in 2008), I would strongly encourage you to bring your old tax returns to a VITA site and ask them to check them over to see if there are any tax breaks to which you are entitled.
http://www.irs.gov/individuals/article/0,,id=107626,00.html

And I agree that Joe’s point is an important one to bear in mind. It is true that payroll taxes hit low-income folks harder, but the benefit formula is also more progressive as well.

On the other hand, there are quite a few low-income folks who sadly don’t live long enough to collect much or any Social Security benefits (or Medicare), because life expectancy and income are highly correlated.

This is especially true for the subset of low income Americans who happen to be smokers, who have also paid a great deal in tobacco taxes. (Economists believe that cigarette smokers pay more in taxes than the costs they impose on society, in large part because they die too young to collect much Social Security and Medicare.)