Tax refunds or the lack thereof

[hornadylnl]

Here's some interesting reading on EIC

Tax Credit or Income Transfer? by Laurence M. Vance

EarnedIncomeCredit

The Political Junkie: An American Presidential History of Redistribution of Wealth.

One of these links attributes the EIC to Gerald Ford, others to Reagan. It's wealth redistribution, plain and simple.

 

[hornadylnl]

That was my thought as well. But she thought it would be better to have that money around just in case we have any unexpected wedding expenses. It wasn't worth arguing about because I figured that I would be getting my refund check soon and I would just use that to pay it off. Here it is a month later and still waiting. She has used the money to pay her uncle for the honeymoon and I'm still waiting on the check.

Regarding the 13% thing, I flipped out when she said that. Certainly the forms had to have the interest rate on them when she signed them, but I guess she didn't pay attention (she probably doesn't even know what a good rate is). Let me just say that she is "less than attentive" to those details. I guess guys just have a way of focusing more on those sorts of things, but I'm working on her. Anyways, there is nothing we can do about it now besides pay it off asap. I would like to get all of our student loans paid off by summer, which shouldn't be a problem. (all of our student loans are higher interest than my mortgage on the house)

Really encouraging to see that people with zero financial sense can get college dimplomas.

 

[Chefcook]

I owe more than I care to think of...

 

[CountryBoy19]

Really encouraging to see that people with zero financial sense can get college dimplomas.

Well, some people don't need the financial sense in their area of interest.

But to address the underlying issue, its not that she is completely oblivious to the details, its just that she neglects them as being important. And at the point that she applied for the loan (nearly a year ago) she just wanted a loan and probably didn't think she'd be raped on the interest rate and therefore had no reason to care about it. She's had previous loans with Fannie Mae that weren't outrageous on the interest, so I don't understand why they'd jack it up, other than she doesn't really have any credit history, and her parents were too far in debt to co-sign for her.

 

[hornadylnl]

Well, some people don't need the financial sense in their area of interest.

But to address the underlying issue, its not that she is completely oblivious to the details, its just that she neglects them as being important. And at the point that she applied for the loan (nearly a year ago) she just wanted a loan and probably didn't think she'd be raped on the interest rate and therefore had no reason to care about it. She's had previous loans with Fannie Mae that weren't outrageous on the interest, so I don't understand why they'd jack it up, other than she doesn't really have any credit history, and her parents were too far in debt to co-sign for her.

My apologies if I came across as attacking her personally.

Regardless of what her major is, everyone should understand finances. What good does it do me to be an engineer making $100k a year if I can't manage my checkbook and spend less than I take in? I've seen plenty of "educated" people ruin their lives financially because they didn't have enough financial sense to get in out of the rain.

I'm sure most colleges don't want to educate their students in finance or they wouldn't have many that would take out astronomical student loans to keep the money flowing in to the colleges.

 

[darinb]

I'm not sure I'd call the Earned Income Credit a welfare check. Yea, if you get it and only worked a month or two and do that every year, then, yea, ok. But for those of us who've worked all our lives and pay unGodly amounts of taxes each year to give to those welfare junkies, then I consider it payback for all that wasted money. Hell, it's not like the dollar is worth the paper it's printed on anyway.

Christ, if you qualify for the EIC, GET IT WHILE YOU CAN. The EIC we got back paid off medical bills and a couple other debts. Yea, my wife makes decent money, but if it weren't for that EIC, we'd been screwed.

+1 If it helps you go for it.

 

[misconfig]

My apologies if I came across as attacking her personally.

Regardless of what her major is, everyone should understand finances. What good does it do me to be an engineer making $100k a year if I can't manage my checkbook and spend less than I take in? I've seen plenty of "educated" people ruin their lives financially because they didn't have enough financial sense to get in out of the rain.

I'm sure most colleges don't want to educate their students in finance or they wouldn't have many that would take out astronomical student loans to keep the money flowing in to the colleges.

QFT!

 

[Soundslikejosh]

I'm lost here. If you already paid for the tuition before the loan was granted, why didn't you just take the money from the loan and immediately pay it off?

13%? Really? Is that a normal rate for student loans?

A more typical rate would be between 5% and 10%. My first loans were 5.75% and later were as high as 7.25%. I've seen others at 8.75% (hence my range of 5 to ~10%)

 

[Blue Tile Spook]

You don't have any clue what that guy's friend PAID in taxes to get that much back. Yet in your mind he's getting welfare back. Ok, I'm done. Have fun with this thread.

Ryan, did you see what I posted for my wife's employee? She did not pay ~50% in taxes to get that refund or "welfare".

 

[ISHOOTHST'S]

I made 30,591 last year 3,209 taken out federal tax. Is this good or bad? 0 exemtions...

state 999
local 476
medicare 426
soc sec 1822

blah blah blah....i get round 1k back on refund every year....so i guess people like me foot the bill for other folks? Seems like married couples take it in the tailpipe bad.

 

[jsharmon7]

I made 30,591 last year 3,209 taken out federal tax. Is this good or bad? 0 exemtions...

state 999
local 476
medicare 426
soc sec 1822

blah blah blah....i get round 1k back on refund every year....so i guess people like me foot the bill for other folks? Seems like married couples take it in the tailpipe bad.

I'm no tax expert but I don't think you get to count Social Security, Local, or Medicare. I think the only taxes they count you as paying are Federal and State. I could be wrong though, I hope so anyway.

 

[ISHOOTHST'S]

You are right but i thought i would list it all...

 

[jsharmon7]

You are right but i thought i would list it all...

Oh okay, I was hoping I was mistaken and could claim a little bit more than I thought I could. Too bad for me.

 

[CountryBoy19]

My apologies if I came across as attacking her personally.

Regardless of what her major is, everyone should understand finances. What good does it do me to be an engineer making $100k a year if I can't manage my checkbook and spend less than I take in? I've seen plenty of "educated" people ruin their lives financially because they didn't have enough financial sense to get in out of the rain.

I'm sure most colleges don't want to educate their students in finance or they wouldn't have many that would take out astronomical student loans to keep the money flowing in to the colleges.

I know what you meant; no offense taken.

She is very fiscally responsible, just never dealt with loans etc. until student loans so she really didn't know how bad of a rate that was. She's mostly done a lot of these things herself because her mom doesn't really deal with any of those things and her dad works long hours (think 12-16 hours a day 7 days a week) so he doesn't have time to deal with them.

Either way, we're working on getting that taken care of. Now that her college is over and she has a job it shouldn't take long to knock out all of our student loans. After that the only debt we have is the mortgage on the house.

 

[phil]

The point of the EIC is that people are getting more back in their "tax refund" than they have withheld from their income. If your return is greater than you paid out, someone else is making up the difference. What else would you call that but welfare?

FYI: This is the difference between "credits" and "deductions".

*Total income-deductions=adjusted gross income
Adjusted gross income is what you are "paying" taxes on.
Credits, such as EIC or CTC, is how people get back more then they paid.

 

[rambone]

Seems like married couples take it in the tailpipe bad.

Single people are taking it worse. I didn't even get a Vaseline Tax Credit before the raping.

 

[eldirector]

Thanks to some major life changes (baby, wife leaving the workforce, company buy-out) and screwy accounting (got a bonus I didn't expect, had too much taken out of my paycheck, etc...) I am actually getting a bunch back from the Feds. I'd rather owe them a dollar, which would mean I'm managing my money right. Oh well, better this year!

Got back about $35 from the state, so that part turned out close enough.

I am SO glad my wife takes care of all this! She majored in accounting for a while, and is much more of a "money person". We tease her and her mother about being related to Leona Helmsley! They beat out TurboTax every year (we double-check against the software). It is amazing the crap you can claim when you start digging through the rules.

 

[mrjarrell]

Unless you qualify for the earned income credit. That's where you only have $1-2k withheld at most and get $3k + back. That, my friends, is a welfare check.

Beat me to it.

 

[Cain71]

It is amazing the crap you can claim when you start digging through the rules.

This is how people make the money......