“Making Work Pay Credit” and the SAHM

“If only one spouse works do I still qualify for the full $800 “Making Work Pay Credit”?

The answer, in MY CASE is yes, because:

We are Married filing Jointly.  Single filers max out at $400.

We make less than $150,000.  Credit starts phasing out over this amount for Married Joint filers.

My husband held only one job in the 2009 tax year.   Having more than one job may result in the credit being withheld  from both paychecks.

Because this a CREDIT on the amount of tax you owe, it may even give you refund even if you do not owe federal taxes.

I’m having a hard time wrapping my head around the fact that we qualify for the full $800.  I mean I’m not complaining, just a little shocked.  This is the first cash value I’ve ever received for being a stay at home parent.

But it doesn’t even matter if we have kids or not.  We would still qualify if we were childless and I did not work  – because we are married.

I mean highly doubt those who are legality entitled to get married would choose to do so for $400.  Especially considering there is no longer a Marriage-Tax penalty.

But I’m surprised this hasn’t opened a bigger can of worms in the endless tax fairness debate…

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Uh-Oh! Big Bulky Letter from the IRS in the Mail Yesterday.

I thought I was a goner.

Maybe they had read my gloating and decided we were up to no good.  Or maybe they had gotten wind of my plan to deny them a free loan next year and had decided to take their revenge…

Was it the dreaded AUDIT?

NOPE!  I had made a mistake on my taxes.  They were writing to inform us that they OWED US more money.   After I filed my taxes I had noticed I made a mistake when claiming the “Making Work Pay Credit”.

One of the questions via Turbo Tax was something to the effect, “Did you already receive the Making Work Pay Credit?”.  I checked YES because my husband did receive a small bump in his paycheck last March.  But the question pertained to those who had received an actual $250 check from the government (ie Social Security recipients, Veterans Benefits, Railroad Retirement…) called the “Economic Recovery Payment”.   It looked to me like we would be “double dipping” on this credit if I did not indicate we HAD in fact received something.  I was wrong.  See Tax Girl’s great explanation of why this isn’t the case.

After I realized this I figured I would just wait for my refund and file and amended return to get back the $250 I had mistakenly said we already received.  Turn’s out the government took care of it for me.  With a very nice letter indicating when my refund comes it will include the additional $250.

Here is something I may never say again, “THANK YOU IRS!”

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