Rotten if true! The tax refund the government gave us in 2001 will be deducted from any refund we have comming when we file our taxes this year! I am sure they don't give you a few dollars if you owe taxes. Bend over here it comes!!!
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Tax Rebate! Is It True???
- Thread starter Happy Camper
- Start Date
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Idon't think that's true. . I may be counted as income but not from the refund. I'll have to ask the better half. She and TurboTax did my return. . It should be deposited friday!!!!
I would not mind it they said "it will all go to the war on terror". Then they are more than welcome to it.
Just finished filing today... No deductions for the check we got.
BTW, with the new tax reforms in place, we ended up paying NO federal income tax. Wish I could say that about the thousands we forked out in SS taxes (eyeing shrinking 401K) that get us nuttin...
BTW, with the new tax reforms in place, we ended up paying NO federal income tax. Wish I could say that about the thousands we forked out in SS taxes (eyeing shrinking 401K) that get us nuttin...
It is not deducted from your refund. The eariler check is calcualted into the tax tables, so it's not acutally subtracted again. I think that if you did not receive the refund check last fall, you can get a credit for it on the 1040.
The tax rates were reduced for the whole year, but it was not decided till last summer. The refund check in the fall was to compensate for the reduced tax rate for the first half of the year. For the 2nd half of the year, the tax rates used to figure you taxes on your paycheck were reduced, so less taxes were withheld for the 2nd half of the year.
I think I got it right, but a tax account could explain it better.
The tax rates were reduced for the whole year, but it was not decided till last summer. The refund check in the fall was to compensate for the reduced tax rate for the first half of the year. For the 2nd half of the year, the tax rates used to figure you taxes on your paycheck were reduced, so less taxes were withheld for the 2nd half of the year.
I think I got it right, but a tax account could explain it better.
H&R Block says different!!
They told me that the friggin' feds are counting it as income and if you didn't include it in last years income, that they'll be sending you a letter notifying you that they're taking out of your refund and that will delay it even further.
I'm glad I called them first.
They told me that the friggin' feds are counting it as income and if you didn't include it in last years income, that they'll be sending you a letter notifying you that they're taking out of your refund and that will delay it even further.
I'm glad I called them first.
WOWZY - your H&R Block office is whacked!
It's NOT income it is a rebate/credit of taxes already collected (in theory) so it's YOUR money! This is from IRS Pub 17 (Tax Guide 2001) straight off the irs site:
Advance payment of income tax.
If you received an advance pay-
ment of income tax in 2001, you do
not have to report this payment as
income on your federal income tax
return. This payment reduces your
rate reduction credit, discussed
next.
Now, if you didn't get your check, you can claim that as some kind of credit on line 47 of the 1040 or on the other forms, too. It's just an advance on your refund, pure and simple, taken out of money already withheld from your wages. If you wind up owing money to the IRS at the end of the day, that $600 was already figured in and they just gave you a loan!
It's NOT income it is a rebate/credit of taxes already collected (in theory) so it's YOUR money! This is from IRS Pub 17 (Tax Guide 2001) straight off the irs site:
Advance payment of income tax.
If you received an advance pay-
ment of income tax in 2001, you do
not have to report this payment as
income on your federal income tax
return. This payment reduces your
rate reduction credit, discussed
next.
Now, if you didn't get your check, you can claim that as some kind of credit on line 47 of the 1040 or on the other forms, too. It's just an advance on your refund, pure and simple, taken out of money already withheld from your wages. If you wind up owing money to the IRS at the end of the day, that $600 was already figured in and they just gave you a loan!
That explanation make more sense. Will see at the end of the month and let a pro do the taxes for us.
Consider your source.
Your not allowed to deduct federal taxes from your income, so refunds aren't added to your income. State income taxes can be deducted from your federal income calculations, so if you get a refund it is added to income (since it was previously deducted).
Ken, Joel and kchristopher got it right. The payment was an advance refund of your 2001 taxes. The payment was based on your 2000 income tax return. If you had no tax liability for 2000 then you got no refund. If you then have a tax liability for 2001 you can take the credit against what you owe. On the flip side if you owed for 2000 and have no tax liability for 2001 you can keep the payment you received and it's not taxable regardless.
Some of these refund payments were intercepted to pay back taxes or alimony or child support in which case you are SOL. :{
Scott
Some of these refund payments were intercepted to pay back taxes or alimony or child support in which case you are SOL. :{
Scott
This incorrect story was circulated by the local Sacramento new stations a few weeks back, and the next day they had a regional IRS rep on the air saying that the IRS had sent out incorrect information previously regarding the 2001 refund.
The correct informations is: The refund we all received in 2001 was based on the income taxes we all paid for tax year 2000, and therefore has no bearing whatsoever on tax year 2001. It was NOT an "advance" and it will in NO WAY AT ALL affect your 2001 tax situation.
Tom
The correct informations is: The refund we all received in 2001 was based on the income taxes we all paid for tax year 2000, and therefore has no bearing whatsoever on tax year 2001. It was NOT an "advance" and it will in NO WAY AT ALL affect your 2001 tax situation.
Tom
It IS an advance on this year's refund, but...
whether you received one was based on LAST YEAR's tax liability. If you paid taxes last year, they assume you'll be paying them this year, too and you got your ADVANCE refund. If you had no tax liability last year, you shouldn't have received the advance payment this year.
The advance payment (verbage directly from the IRS website) was in anticipation of you paying lower taxes THIS year because the rates were lowered. Since they had already been withholding taxes from you at the higher rate, they issued advances on this years tax bill figuring your overall liability this year was going to be less and you'd have money coming. Rather than hold it all until the end, the gov't wanted to stimulate spending, so they got it in our hands sooner rather than later. Some bean counter devised the threshold of LAST year's tax liability as the trigger for whether you qualified for the advance refund payment.
BK - state refunds are counted as federal income because you can deduct state taxes from your federal returns. If you over pay your state and get money back, you have to tell the IRS what that amount was since you had previously deducted it and not been taxed on it.
whether you received one was based on LAST YEAR's tax liability. If you paid taxes last year, they assume you'll be paying them this year, too and you got your ADVANCE refund. If you had no tax liability last year, you shouldn't have received the advance payment this year.
The advance payment (verbage directly from the IRS website) was in anticipation of you paying lower taxes THIS year because the rates were lowered. Since they had already been withholding taxes from you at the higher rate, they issued advances on this years tax bill figuring your overall liability this year was going to be less and you'd have money coming. Rather than hold it all until the end, the gov't wanted to stimulate spending, so they got it in our hands sooner rather than later. Some bean counter devised the threshold of LAST year's tax liability as the trigger for whether you qualified for the advance refund payment.
BK - state refunds are counted as federal income because you can deduct state taxes from your federal returns. If you over pay your state and get money back, you have to tell the IRS what that amount was since you had previously deducted it and not been taxed on it.
Yes, if you payed attention you would have known that the $300 you received was a loan against your 2001 tax return.
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