Yes, I understand how it could. But I dont see how someone could sell the idea of screwing more people as a valid solution to feeling screwed. 
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This site says active owners of C-Corps and S-Corps are required to take a reasonable salary. This one mention a 60/40 rule: “if a corporation is distributing profits to its owners and has not hired any other employees … 60 percent of the distribution should be treated as salary.”
That’s what fairness is sometimes about. It’s like some of the game theory experiments, where people are divided into groups of two, then one person from each group is given $20 to share with their partner any way they choose, but they both only get to keep the money if the partner accepts their first offer. Offer me anything less than half and I might decline it to punish you for being unfair, even if it punishes me too. Logically I should accept anything above $0, since it’s either that or nothing to me.
I understand the point, I just disagree with it, so I’m the first to point out an error when someone makes the phase out seem worse than it really is a la “think of the children.”
The fact remains, if you made more than 50k as a single person or 100k as a family last year, you don’t need relief. This is a poorly targeted relief bill and anyone that doesn’t get th money because of their income should be ashamed if they feel like they deserve it.
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Well, nobody “deserves” a handout, and few people actually need it. In fact, if your income wasn’t affected by the pandemic regardless of how much you made, you shouldn’t get anything. We should’ve done what some European countries did, which is to keep everyone’s jobs and pay most of their pre-pandemic salaries. It’d probably be cheaper. There’s no reason to send an extra $3200 (1200+600+1400) to someone on Social Security or SSI – their income was not affected!
In the grand scheme of things, “money” is just a concept we invented to keep ourselves busy, and federal income tax is just a way to counteract the printing press.
#freeyourmind #woah #ismatrix4outyet 
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That’s the personal services corp thing I mentioned.
I had employees. And regardless, I received no ongoing distributions, dividends, or other payouts anyways - the corp kept all it’s cash. In short, I was handed a mess and invested a few years trying to fix what proved unfixable - had I been received 6-figures in dividends after working all year for free, that could potentially have caused issues (although I still hold there was no salary requirement).
Besides, if I was earning income but labeling it as something else, I’d still include it in my lifetime earned income when making such a claim here .
That’d definitely be cheaper. We’ve gotten money out of the first two rounds and did not miss a single paycheck. In fact, I just got a bonus on top of a raise so not hurting financially. Especially considering I have not been able to spend like I usually do (travel, entertainment). It’s absurd to inflate the costs of the “relief” for people who don’t need it. Like it was absurd to do the first round as stimulus. Data showed that the vast majority of the checks went either into savings or towards debt reduction. The checks barely moved the needle at all on consumption. It’s beyond belief to me that something like this that’s been proven to be a very poor return on investment twice continues to be advertised as the panacea.
They should indeed have gone to an income replacement model supplementing unemployment insurance (for those whose suffered loss in income but don’t qualify for unemployment and those excluded from the first round like college students). That would have made more sense morally and financially as well.
The early claims were that a targeted system was too hard to implement. In March 2020, maybe that was fair enough. Trump administration was completely incompetent at understanding how catastrophic this pandemic was gonna be and did not use the time well to prepare for it. But since then, there WAS ample time to plan for more targeted relief. Yet here we are again with another absurdly-designed stimulus package. Makes you wonder if we’re simply dumber than everybody else and too proud to admit it and copy what has worked for cheaper elsewhere.
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What I remember reading was that the checks were 50% less effective for their budgetary costs than the enhanced unemployment benefits and 33% less effective than the Paycheck Protection Program. Bottom line for me was that there are much better ways than these checks to provide a GDP boost for the debt burden we’re tacking on.
I’m not sure how discussion on income levels to qualify or not even matter. If you suffered no loss of income due to COVID, regardless of income level, you should not be getting any handout.
On the tax credit issue, if they are following the basis of the previous tax credits, the phase out is 24% instead of 5%. So it’s a bubble phaseout of 24% that could incentivize a lot of decisions to make at the end of the tax year - do some tax loss harvesting, fund the 401k or HSA (or deductible IRA for those without access to retirement plans, as $75k is about the phaseout for the IRA deduction), etc. TTB - Free Services
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[quote=“meed18, post:63, topic:4087”]
The fact remains, if you made more than 50k as a single person or 100k as a family last year, you don’t need relief.
[/quote
This post makes sense.
The basic reason so many of us received a stimulus payment was because we all filed our IRS. (isn’t that where they get their info for payment)) Now those folks who probably really are suffering never filed Income Tax… So they get nothing.
Of course (as a rule) these same individuals do get food stamps & other state payments.
As someone mentioned earlier, none of us here need these payments. 
Govt working overtime!!
What was missing was federal leadership and state cooperation. Yes, a simple replacement for a number of weeks and we really would have gotten cases down to zero. Then return to normal (with travel quarantines) and surveillance until minor outbreaks every few months in localized areas. Instead of a lost year of productivity and massive spending (of much higher than would have been needed for full replacement on the short term option).
There was no point in a full income replacement since there was no effort to contain the virus and instead an effort to spread it as much as possible. It wouldn’t have helped anything.
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I don’t think that’s how it works. Not everyone is required to file taxes. Social Security and SSI recipients are not required to file taxes if the income is below a certain amount, and IRS already has their information on file. For others, IRS provided forms one could fill out to receive the payments.
People who qualify for food stamps definitely qualify for all the federal stimulus checks.
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I have a cleaning lady (Mexican) & I don’t believe she received a payment. Outside of early in the pandemic, (when some folks didn’t use her) she is a very busy lady & actually makes a fine living.
In my opinion folks like her should be commended because they take care of themselves & really don’t ask for govn help.
I never asked her about whether she paid taxes. In her case, she wouldn’t receive a form from IRS.
Well personally I think sending out checks to anyone isn’t needed ( way too poorly targeted for several reasons ). There is already unemployment increases and loan forbearance for those that need more help… Vaccinations for the entire US is predicted to be 2 months away. It is just a different time now than it was Jan 1st when this was proposed.
But in general, I just think steep cliffs in benefits create bad situations. People that earn less should not be in a better situation than people who earned more.
The White House has boasted that 76% of Americans are in favor of the stimulus plan. Lets ask those that were just excluded from the stimulus plan ( which I agree don’t need it ). I’m guessing the new approval rating in that group would be far far less than 76%. Everyone loves a handout. Remove the stimulus checks for everyone and it becomes a bill that the American people suddenly hate.
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“in favor of” is not the same as “needs”. I’ll bet a meaningful percentage of that 76% is in favor simply out of greed. If the government wants to send me a check for $1400, or $300/week for most of the next year, or whatever else, why would I tell them no?
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Rather than a percentage based phaseout the new stimulus will use a ratio based phaseout. This has really odd implications. Take a single parent with five children who files head of household - they will have a greater than 100% tax rate once they have $112,500. They would also phase out of the child tax credit, although at least that is using the standard 5% phaseout. If you know anyone in this situation, it is crucial that they understand so they can contribute to 401k, 457, HSA, make a “lottery-style” options bet to take the $3,000 maximum capital loss, whatever - so they don’t miss out. After the calendar year ends, the only way to reduce AGI from the previous year is deductible IRA contributions - only for those making less than $76,000 for a single, if you are covered by a retirement plan at work which affects anyone with a 401k; HSA deduction, only if one is in a High Deductible Health Plan; and contributions to a solo 401k, SIMPLE IRA, or SEP IRA, but only to the extent of self employment income.
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If you know anyone in this situation, put them in a barn and charge admission because people would pay good money to see a unicorn!
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great list of above the line deductions to create your own stimulus check! The capital loss idea reminds me of “The Producers”!
Unfortunately a lot of them phase out in the 150K+ range but your point is well taken for the benefits cliff based approach vs flattened phase out.
One other change in the works that would warrant delaying filing taxes until closer to the deadline.
While the extra $600 and later $300 per week that was added to Unemployment Insurance due to the pandemic were excluded from all income taxes right away, regular UI benefits are usually subject to federal income tax. Congress is working on something that would waive taxes on the first $10,200 in unemployment compensation that taxpayers received in 2020 for people who make less than $150K (not sure if individual or joint, but I’m guessing joint, which would be yet another big hit for any “unicorn” that happens to have earned more than the cutoffs). My understanding is that it was included in what the Senate passed.
Well here’s something extra for the $160+K MFJ “unicorns”. I believe they won’t get anything in the stimulus $ for kids, unlike round 2
What would the bill change about the child and dependent care tax credit?
This credit, which helps working families offset the cost of care for children under 13 and other dependents, would be significantly expanded for a single year. More people would be eligible, and many recipients would get a bigger break.
The bill would also make the credit fully refundable, which means you could collect the money as a refund even if your tax bill was zero. “That will be helpful to people at the lower end” of the income scale, said Mark Luscombe, principal federal tax analyst at Wolters Kluwer Tax & Accounting.
How much would the credit be worth?
The new bill would make the credit worth up to $4,000 for one qualifying individual or $8,000 for two or more. The credit would be calculated by taking up to 50 percent of the value of eligible expenses, up to certain limits, depending on your income. (The more you earn, the lower the percentage you can claim.)
Currently, the credit is generally worth between 20 and 35 percent of eligible expenses with a maximum value of $2,100 for two or more qualifying individuals.
The bill would also significantly increase the income level at which the credit begins to be reduced. Under current law, that starts at an adjusted gross income of $15,000, but the bill would make the full value of the credit available to households making up to $125,000.
Under current law, the credit is not further reduced below 20 percent, regardless of income, Mr. Luscombe said. But the proposed law would begin to reduce the credit below 20 percent for households with income of more than $400,000.
These changes would be effective for 2021 only.
What about dependent care flexible spending accounts?
The bill would make one big change. For 2021 — and only for 2021 — you could set aside $10,500 in a dependent care account instead of the normal $5,000. But employers would have to allow the change: You can’t adjust the withholdings from your paycheck yourself if your employer declines to provide the option.
How would the bill change the child tax credit?
The bill would make the credit more generous for 2021, particularly for low- and middle-income people.
Currently, the credit is worth up to $2,000 per eligible child. The bill would increase it to as much as $3,000 per child ($3,600 for ages 5 and under). It would also raise the age limit for qualifying children to 17, from 16.
Would it change how the credit worked?
Here’s where it gets interesting: You could receive some of the credit as an advance on your 2021 taxes.
The bill would make the credit fully refundable, which means you can receive money from it as a tax refund even if your tax bill is reduced to zero. And half of that money could be advanced to households over the next six months (based on their 2020 tax information, or 2019 if that was unavailable). It’s not clear how frequently payments would be made — perhaps monthly — but under the bill they would begin in July.
The changes are effective for 2021 only, though at least some Democrats would like to make it permanent.
Who is eligible?
Married couples who have modified adjusted gross income up to $150,000 (or heads of household up to $112,500 and single filers up to $75,000) would receive the full value of the new benefit.
But after that, the extra amount above the original $2,000 credit — either $1,000 or $1,600 per child — is reduced by $50 for every $1,000 in modified adjusted gross income that exceeds those levels. (For joint filers with one child age 6 to 17, the extra amount would be phased out at about $170,000.)
At that point, the tax credit levels out at $2,000, and is then subject to the current income limits. The $2,000 benefit begins to phase out when married filers have adjusted gross income of $400,000 ($200,000 for singles).
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