Liberal Economist Wanted...
…to explain the following from today’s Washington Post:
“The dust-up centers on an obscure provision in the 10-year, $1.35 trillion tax cut that Congress passed in 2001. That tax cut expanded the $500-per-child tax credit to $1,000, but it also made another child credit available as a tax refund to some poor families who pay little or no federal income taxes.”
Explain the following media math problem: A family pays no federal income taxes, but have been receiving a federal tax “refund.” How is that possible?
Please show your work.