SageBrush wrote: ↑
Fri Apr 30, 2021 9:23 am
You also appear to think that tax with-holding affects taxable income. It does not.
That's why I hate taxes
I know it doesn't affect it, it only affects how much you pay to the government in the event that the amount of withholding was not enough to cover how much you owe. I was referring to keeping the money early instead of getting it back at tax time. That's all that trick does.
If you made (for example), $47,000 in 2013 and the tax bracket said you owed $7,500 and you didn't pay any withholding that year and decided not to do any deductions (hypothetical of course), you would owe the IRS $7,500. The EV tax credit would apply to this and thus, you would owe the IRS $0. The problem was, if people didn't make enough income, they couldn't use the whole $7,500. So if you made $30k that year and only owed $5,000 (example) in tax, the credit would only pay the $5,000 and the IRS would NOT
give you an extra $2,500 to make up the difference. The only reason I've encountered it so much was because of myself and friends/family that bought a new Leaf and had the same issue, not enough tax debt to use the whole credit. So the tax accountants had to get creative.