"Refundable" Tax Credit

It's important that we perfectly understand what a "Refundable Tax Credit" is, so we can share it with our friends, family and neighbors . It is Washington-speak for sending checks to those who pay no income taxes at all. I think we call that "Welfare, " but Obama does not.

Obama says his Tax Plan will give 95% of Americans a Tax Reduction. However, over 40% of Americans (tax filers) pay no income tax. So their tax "reduction" is in the form of a "Refundable" Tax Credit - a check from the government (us).

Over 40% of income tax filers will get checks from - in lieu of writing checks to -the IRS; 55% of filers will get a tax reduction; so only 5% of tax payers will bear the burden of the "refundable" credits and reductions for 95% of Americans. I'm somehow thinking that isn't really fair, but it helps me to understand what Obama means by "economic justice." It means "spreading the wealth around."

My reason for this post: We just had some friends visit for a couple of days . . . very intelligent - though they are Democrats! ;) . . . politically astute . . . small business owners and they did not know what a "Refundable" Tax Credit was. After that I decided to write this, just in case there are others . . .