Making work pay IRS deduction for $400? How does that supposed to work on filing taxes for last year?

I did free efile with tax software on IRS website and put that I didn’t get $400 so they gave me the deduction? I thought it was supposed to be as reduced withholding taxes for working people?
I guess it is totally confusing to me. I thought we only got the $8 or so extra every week. It is good that the free efile has software to do all the paperwork for you to get all the deductions you are entitled to.

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Comments (2)

 

  1. rtfm says:
    May 16, 2010 at 9:21 pm

    That’s exactly what it was. And then you get a $400 credit on your taxes to make up for the extra $400 that you got in your paycheck during the year. It balances out.

  2. Jss says:
    May 16, 2010 at 9:46 pm

    You get $400 credit if your earned income is more than a limit. You complete schedule M (Form 1040).

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