Making Work Pay Credit?

[ILLMAS]

Ok my fisrt return and I alreay have a questions regarding the making work pay credit. I have a TP that worked pretty much the whole 2009, so somehow he already recieved the $400 during the year, now his wife didn't work, and from reading the instructions, anyone can claim the credit if they have earned income. ATX is giving an $800 credit, I am afraid it's double dipping for the husband who worked and and it should be zero for the wife. I attended a tax seminar about 2 weeks ago and the presenter said to go ahead and claim the credit, since the instructions are not very clear. Can someone please inform me on how to go about claiming the credit.

Thanks,

MAS

[Pacun]

The credit is $400 for each tax payer who is not a dependent. Forget about the W-2 and what happened at work with the withholding table.

[kcjenkins]

Mas, it's not double-dipping. The $400 he MAY have gotten in his paychecks was not from Uncle, it was just a reduction of his own withholding. Now is when he gets it from Uncle Sam. Hope that makes it clearer.

[ILLMAS]

Mas, it's not double-dipping. The $400 he MAY have gotten in his paychecks was not from Uncle, it was just a reduction of his own withholding. Now is when he gets it from Uncle Sam. Hope that makes it clearer.

Got it, thanks, just one more concern I have, the wife, she had zero income, and from the instruction, the credit is for EARNED INCOME, would it be correct just to claim the $400 for the working husband?

Thanks

[kcjenkins]

The credit is $400 for Single and $800 for MFJ. It does not matter if all the earnings is from one of them. The worksheet is doing it right, you do not need to override anything.

[TAXBILLY]

Trust the form. They would be entitled to the $800 even though she did not work.

taxbilly

[Janitor Bob]

What about Federal taxes withheld from pay....I know the amount was reduced last year automatically due to this credit...So people saw slightly higher take-home pay. What about this year? Has or will those Federal tax withholding rates be increased to pre-credit level?

[Bart]

What about Federal taxes withheld from pay....I know the amount was reduced last year automatically due to this credit...So people saw slightly higher take-home pay. What about this year? Has or will those Federal tax withholding rates be increased to pre-credit level?

The credit is still available in 2010. For 2010: Notice 1036 contains the 2010 withholding tables, which reflect reduced withholding resulting from the Making Work Pay credit.