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Financial Planning / Tax Strategies


Subject:  Re: Water Cooler Talk Date:  1/27/2009  8:28 AM
Author:  YewGuise Number:  104002 of 127753

I do wonder how many people realized the stimulus check was taxable income. The message was, after all, "spend it all!"

Maybe if/when stimulus checks go out this year, they should be net amounts, with 40% Fed'l tax withheld. I realize the top rate is 35%, and most people getting stimulus checks won't hit that, but if extra is withheld, then there will be enough of a Fed'l refund to help cover state taxes.

For unemployment checks, MD gives recipients the option of having tax withheld. They don't do any calc's on what your tax bracket is, they'll either withhold 17% (IIRC) or nothing. So it's pretty simple.

People do anticipate certain results when they file their taxes, and having to pay extra, or getting less of a refund, is disappointing in the short term even if it's mathematically to their benefit over the course of the year.
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