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Some things about the way the tax system works seems unfair to me. Check out this scenario.?

A family that I know just got their taxes filed. They are a low income family (less than $20,000 yearly), and they draw food stamps. They have two children. Obviously they didn't pay out a whole lot in taxes because they didn't make it to tax. Still their return was for approximately $6,000. That's not a typo!! My question is how come families that earn a respectable living, do not bum off of the government, and pay out the butt in taxes always run the risk of getting hammered come tax time?

Update:

I'm understanding. However, for those of you that think that I should like the idea of it you can forget it. People do get down on their luck, and that's when we should do the generous thing. Too many people settle for a lifestyle like I've described, and have no desire to better themselves. Those people don't deserve the extra help.

And to the guy that said I should have a few more kid....you are smart enough to realize that any extra money you might get go straight into the mouths and on the backs of those kids. How would that help?

5 Answers

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  • 1 decade ago
    Favorite Answer

    Yes, as others have already mentioned, it's the Earned Income Credit or, in plainer English, welfare at tax time. It's really a disgusting travesty being foisted upon hard-working, 'real' tax-paying Americans. The worst part is most of the people receiving this credit have no idea they're getting a handout. They actually believe they somehow "earned" this money. I'm a tax preparer by profession so I know what I'm talking about.

  • 1 decade ago

    Simple. Low-income (working poor) families get assistance in the form of the Earned Income Tax Credit. I know several families that collect it, mostly single parent families with 2 or 3 kids.

    It makes the difference between a basic existence and living on the streets. Having been in that boat in the distant past, I can appreciate the difference that it makes. Now that my income is well beyond the point where I'd need that assistance, I have no problem at all with sharing the wealth a bit.

    Hopefully you'll never need it. But if you do, you'll be DAMN GLAD to get it! My best friend never though she'd need it; she was married with a 6-figure income. Now she's scratching out a basic existence with 2 kids on about $18k a year. The ETIC keeps them off the street.

  • Vegan
    Lv 7
    1 decade ago

    That's the earned income credit.

    In answer to your question, the families that earn more can afford to pay more in taxes.

    Even with the higher tax burden, I bet you'd rather be a member of the richer family than the poorer one.

  • 1 decade ago

    well they are living below the estimated earnings for a family of that size , plus they get the earned income , a family of that size should be living off an income of lets say for example 30,000.00 they are actually living off 10,000.00 less than what it takes for a family of that size so the get what is called tax credits ..if you want a bigger refund try living off of theirs for a year, it is no easy road to go down, living off 20,000 is not enough for one to live on., your tax is based on your income ..the less made ,the less paid in....if my grocery bill is 2.00 ,and yours is 15.00 ,and we both gave a 20.00 dollar bill to the cashier who would get the most back.........they have to live off less that's why ,you can do it too , if it means that much to you , we have a annual income well over 50,000 , we get an average refund per year of about 5000.00 I claim the kids , she claims the house and other deductibles we are not married , have two addresses and file separately , that is how we do it.....maybe you need more deductions , have a few extra kids ...they work good

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  • Judy
    Lv 7
    1 decade ago

    They would have gotten the Earned Income Credit. The maximum for that this year is $4536.

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