Tax credit could cost taxpayers $1 billion

Tax credit could cost taxpayers $1 billion

ca.povertyCalifornia now is considering a state-level Earned Income Tax Credit. That comes just in time for Jan. 27, the IRS’ EITC Awareness Day. (I am not making this up.)

According to a study by the Legislative Analyst, requested by the Legislature:

The federal EITC is an income tax credit that increases the after–tax income of low–income workers. Evidence from academic studies suggests that the federal EITC causes paid work participation among single mothers to be higher than if the EITC did not exist. It also reduces poverty to some extent for tens of millions of people.

Problems:

Evidence from the federal Internal Revenue Service (IRS) also suggests that improper federal EITC payments are an issue. Roughly a quarter of federal EITC payments go to people who are in fact eligible for a smaller payment or are not eligible for the EITC at all.

And Forbes reported:

The IRS estimates an error rate of 23%-28% on EITC returns, or about $13 to $16 billion paid out in error. Yes, billion with a b.

Actually, there are better ways to help the poor than a program that would cost taxpayers up to another $1 billion: cut taxes, especially the sales tax; and reduce regulations, especially on housing and small business.

But that’s not going to happen. Instead, we’ll get more gimmicks like this.

 

6 comments

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  1. Dork
    Dork 22 December, 2014, 12:31

    John,

    You sound as though you believe that they truly want to help these people?, Let me help you out if I may. Their only intention and goal is to enslave as many people as they can, the more people that depend on them for their very survival means they will get their VOTES to remain in power. You see it is all about the lust for Power and Control over your fellow man that drives theses people, proud liberals that is. STOP giving these the Benefit of Any Doubt, they are just plain EVIL.

    Reply this comment
  2. Queeg
    Queeg 22 December, 2014, 19:31

    Wrong wrong.

    They give goodies so the Vandals and Visgoths don’t invade Santa Barbara, Half Moon Bay, Sausalito, West LA and Rancho Santa Fe!

    They will come….Enough is not enough.

    Reply this comment
  3. NTHEOC
    NTHEOC 22 December, 2014, 21:16

    All the millionaires find ways to avoid paying their fair share and evade taxes! I bet the poor and middle class pay more taxes than any pig millionaire! Not only is this a good deal to help out the poor but they should also go after the rich even more for as much taxes as they can. We need to lower the income gap and bring equality to the people!!!!!!!!

    Reply this comment
  4. NTHEOC
    NTHEOC 23 December, 2014, 08:15

    I know this is poisen to a DOOMER sight like CWD but since its the holidays I thought I could spread some cheer!
    —————————————–
    US economy grew at fastest rate in 11 years last quarter
    WASHINGTON — The U.S. economy grew at a sizzling 5 percent annual rate in the July-September period, the fastest in more than a decade, boosted by strength in consumer spending and business investment.
    The resurgence in growth last quarter provided the latest evidence that the U.S. economy is steadily strengthening and outpacing most others around the world.
    The Commerce Department on Tuesday sharply revised up its estimate of third-quarter growth from a previous figure of 3.9 percent. Much of the strength came from consumer spending and business spending on structures and computer software.
    It was the fastest quarterly growth since the summer of 2003. It followed a 4.6 percent annual growth rate in the April-June quarter.
    LOL!!!!!!!!!!!!!! Sorry DOOMERS.

    Reply this comment
  5. Ulysses Uhaul
    Ulysses Uhaul 23 December, 2014, 09:16

    Pension funds will boom….boom….boom.

    Sorry doomers……

    Seasons Greetings!

    Reply this comment
  6. Dork
    Dork 23 December, 2014, 13:08

    US economy grew at fastest rate in 11 years last quarter ??

    Have you ever bothered reading past the headlines?? If you did, you wouldn’t make a fool of yourself in front of God and everyone else.

    http://www.zerohedge.com/news/2014-12-23/here-reason-surge-q3-gdp
    http://www.zerohedge.com/news/2014-12-23/exposing-deception-how-us-economy-grew-140-billion-q3-due-data-revisions

    site crashed today from too many people becoming informed, save the links and try later if you dare to believe the truth.

    Reply this comment

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