” I like the Feds they just hand the $8000 back to you, California makes it sound good, but it is ONLY a credit, if you don’t owe the state above $3300 you only get a credit for what you owe. Meaning my understanding if I owe $300 I do NOT get a rebate of $3000. I only get a credit towards the $300. ”

Is this true that we must reduce our withholding in order to owe the government more than $10000/3, so that we can get the credit? That would be really unfair for people who withholding less such that they effectively lend the government some money for free, and now they don’t get the credit because of their well-doing?