How Does This Make Sense?

A friend is working on her taxes.  She's mostly a poor college student so she didn't pay a lot in taxes and she didn't earn a lot in income.  It would make sense to me that she would get the entire amount she paid in taxes back this year.  How is it, then, that due to all sorts of credits she actually gets tax refund in an amount that is more than twice what she actually paid in taxes?  And through the power of google, we discover she is not the only one?  How does this make sense when the government is a bajillion dollars in the hole?

Comments

[Robin]

Yeah, that happened to me when I was in graduate school. It's got something to do with Earned Income Credit...

[Hazel]

There is a credit for education expenses this year that can give you more money back that what you actually paid in. I think it's about time that this country give a break to people that are educating themselves, especially since so many college grads are having trouble finding jobs.

[KatieOh]

I work for the dept. of social services and every year our office runs a program to help people do their taxes for free and qualify for the "earned income tax credit." I think that's all fine and dandy, but what I have never understood is how someone can get back more in a refund than they actually paid in the first place. ??????? Every year we have a presentation at our staff meeting about how successful the free tax assistance was and how much people got back....the people we help are generally on assistance and get back more than they earned. I had a client a few years back who had barely made $10K; was on all types of assistance including daycare...and got almost $9K back. And they expected us to be excited. Sure.

[KtP]

I used to get my taxes done with VITA (voluntary tax assistance/ts) but then I felt guilty since I can afford - and am smart enough - to do my own.

[Karla]

I say we blame the Republicans. They just loooooooooove tax credits! I am just kidding. I think the whole tax-filing thing is strange. If the very affluent, non-profits, giant corporations, new homebuyers, parents and churches all get various tax breaks, I don't have a problem with a low-income college student getting a break. It's kind of like the IRS saying, "You overpaid this year, but we didn't know until after you filed that you'd qualify for this break." But I always get jealous when people get back some kind of giant refund for which I don't personally qualify. Hmmph!

[Joanne]

I'm okay with college kids not paying anything in taxes. I'm confused by the getting 2 or 3x what they paid back. She's getting a $2200ish refund. She only paid just over 600 in taxes. WTF? (Well and of course I might be a little jealous. :) I told her she could cut me a check because I'm sure my taxes paid for her refund. :P )