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Posted by Mark Bole on April 9, 2008, 11:19 pm
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kastnna wrote:
>
>> Those who take the EITC are more likely than those who do not (all
>> other things equal) to be audited.
>
> I'm not disputing this, but could someone please enlighten me. What's
> the logic in this?
>
> P.S. - I don't know much about the EIC other than the very basics, so
> please "talk slowly".
With most tax tussles, it is your own money that is potentially being
refunded to you... you can't get back more than you put in (once your
tax is down to zero, additional deductions will gain you nothing).
With credits such as EIC, we're talking welfare -- it is someone else's
tax money that you are going to get back. The incentive to game the
system is much higher.
-Mark Bole
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