Comments on: Refundable and Non-Refundable Tax Credit in Charts

By: Christina

Christina — Sat, 26 Jun 2010 03:16:23 +0000

The adoption tax credit is now refundable, at least through FY 2011.

By: David H.

David H. — Mon, 01 Mar 2010 19:22:58 +0000

Care to send the book my way since you’ve finished it? haha. I like the charts you did fine. They illustrate what you had written well.

By: KD

KD — Wed, 24 Feb 2010 15:47:56 +0000

I tend to use Powerpoint. With its nifty drawing tools, its a lot easier to create illustrations as long as you don’t need to use comparative data, say, as you would in excel. Just select all elements at the end and group them to create a wonderful picture and use it where ever you want.

By: TFB

TFB — Wed, 24 Feb 2010 04:35:35 +0000

@Sammy - I just started my quest for creating better visuals. As JW pointed out, I'm not quite there yet. I read Charts and Graphs for Microsoft Office Excel 2007 and I liked it.

By: JW

JW — Wed, 24 Feb 2010 04:18:24 +0000

I’m not sure the charts clearly explain your point, especially with the line at the top and bottom of withholding. The key takeaway is total take-home pay… If you displayed annual income in addition to the withholding and tax liability you could show that someone that qualifies for a refundable credit could end up with more money than they earned in a given year. An example using real-world numbers might help too.

By: Sammy_M

Sammy_M — Tue, 23 Feb 2010 16:07:21 +0000

I’m a huge fan of visuals, but I think these statements in your prior post made the point pretty clearly: “A refundable tax credit can reduce your total tax to a negative number, which means the government pays you” and “If you pay enough taxes, it doesn’t matter whether a tax credit is refundable or non-refundable.” Not sure why some had such a hard time with the concept.

Becoming better with visuals is one of my aims as well. Any good book recommendations on this?

By: TFB

TFB — Tue, 23 Feb 2010 16:04:22 +0000

@jim – Thank you. I added Making Work Pay to the table.

@Chuck – That’s the crux of the problem. It makes it hard to explain “I’m getting a larger tax refund because of some non-refundable tax credits.”

By: Chuck

Chuck — Tue, 23 Feb 2010 15:57:08 +0000

One problem is they’ve gone and used the word “refund” in two different ways. Sometimes it’s a return of overpayment, sometimes it’s paying out a credit that is greater than tax liability.

By: jim

jim — Tue, 23 Feb 2010 14:43:09 +0000

I think the Making Work Pay credit is also refundable. That will be a big one for most people this year.