Questions and Answers about the Recovery Rebate Credit
The following are answers to some basic questions regarding the recovery rebate credit. Check back periodically for updates and additional questions and answers that may be added.
Basic information
Q. What is the recovery rebate credit?
A. This credit is a new refundable credit that is related to the 2008 economic stimulus payment. Generally, a credit increases the amount of a refund or reduces the amount of taxes owed. Those who did not receive their economic stimulus payment (or did not receive what they were fully entitled to) in 2008 are eligible for the credit.
Q. What is the basis of the recovery rebate credit calculation?
A. The recovery rebate credit is calculated the same way and with the same requirements as the 2008 economic stimulus payment. The only difference is that the credit is based on the tax year 2008 income tax return and the stimulus payment was based on the tax year 2007 income tax return.
Qualifying for the rebate
Q. Who is eligible?
A. Those who were eligible for the stimulus payment but did not receive it (or did not receive what they were fully entitled to) in 2008 are eligible for the credit. Also eligible for the credit are those who did not meet the requirements for the stimulus payment last year but whose circumstances have since changed, causing them to now meet the requirements.
Q. Why doesn’t everyone qualify for the rebate?
A. Most taxpayers have already received their full benefit in advance in the form of the 2008 economic stimulus payment. However, if certain conditions changed for taxpayers in 2008, they may be eligible for an additional benefit.
Q: How will the recovery rebate credit payments be made?
A: The Treasury won't send out separate economic stimulus payments for 2009. Instead, those eligible will claim the rebate credit on their 2008 returns. Credits generally increase the amount of a refund or reduce the amount of taxes owed.
Q. I was claimed as a dependent on my parents’ 2007 tax return, and was not eligible for the stimulus payment, but I lived on my own in 2008. Do I qualify for the rebate?
A. That depends on whether you can be claimed as a dependent on your parents' 2008 return. The rebate is based on circumstances that occurred in 2008, while the stimulus payment was based on the 2007 tax return filing information. You'll have to use the tax booklet's worksheet on claiming the recovery rebate credit to see if you're eligible to claim it.
Claiming the credit
Q. How do I claim the recovery rebate credit?
A. Use the recovery rebate worksheet that is found in your 2008 tax booklet to figure the credit you can take, if any. Then, include that figure in the payments section of your 2008 tax return.
Q. How do I get help figuring the credit?
A. The IRS will figure the credit for you, if you enter “recovery rebate credit” next to line 70 on your Form 1040 (line 42 of Form 1040A; line 9 of Form 1040EZ). You can also access the online recovery rebate tools using the recovery rebate credit link on this Web site. For taxpayers filing electronically, the software will calculate any credit they may be due.
Q. What info do I need to figure the credit?
A. If you received your 2008 economic stimulus payment, you will need to know how much you received. The IRS sent Notice 1378, Economic Stimulus Payment Notice, to taxpayers who received a payment, showing the amount received. If you don’t have your notice, you can use the online tool How Much Was My 2008 Stimulus Payment?.
Q. What tools are available to help figure the credit?
A. The IRS will post interactive tools on this Web site to help figure the Recovery Rebate Credit: the Recovery Rebate Credit Calculator and How Much Was My 2008 Stimulus Payment?. The 2008 tax packages also include a worksheet to help figure the credit.
Q. When can I expect to receive my rebate?
A. The rebate is part of your 2008 income tax refund. The amount you receive for the recovery rebate credit will be included as part of your refund, as shown on your tax return. Unlike the stimulus payment, it will not be issued as a separate check. You can check the status of your refund under Where’s My Refund?. Generally, you will receive your refund within 6–8 weeks after you file your return.
Q. I am not required to file a tax return, but I still would like to get the rebate. How do I claim the rebate?
A. You must file a tax form to claim the credit, and be sure to fill in lines 7, 20a and 70 of your Form 1040 (lines 7, 14a and 42 of Form 1040A; lines 7 and 9 of Form 1040EZ).
Q. Because the IRS applied part of my stimulus payment to an outstanding debt, I actually received less than the total amount as stated on my Notice 1378. What amount should I use when figuring my credit?
A. You must use the total amount — the amount before the deduction to satisfy the debt — as stated on your Notice 1378. That total is considered to be the amount of your stimulus payment, even though part of it was used to satisfy a debt. The recovery rebate credit must be reduced by the amount of your 2008 stimulus payment.
Economic stimulus payments received
Q. Do I have to claim my stimulus payment as income on my 2008 income tax return?
A. No, the stimulus payment is not reportable as income on your 2008 income tax return.
Q. My stimulus payment was more than what the worksheet calculates my recovery rebate credit to be. Does this mean I will have to pay the difference?
A. No, you do not need to repay the difference, and the difference will not affect your return. However, your recovery rebate credit will be zero.
Q. Will the payment I received in 2008 reduce my 2008 refund or increase the amount I owe for 2008?
A. No, the stimulus payment will not reduce your refund or increase the amount you owe when you file your 2008 tax return.
Q. I have no earned income and no filing requirement, but I filed a 2007 economic stimulus payment return to get the payment. Do I have to file a 2008 tax return?
A. If you received your stimulus payment, no. If you did not receive the stimulus payment, and do not pay income tax but have at least $3,000 in qualifying income for 2008, then you should file a 2008 tax return to receive the recovery rebate credit.
Showing posts with label Stimulus Check. Show all posts
Showing posts with label Stimulus Check. Show all posts
Tuesday, January 6, 2009
IRS Stimulus Check Recovery
The recovery rebate credit is a one-time benefit for people who didn't receive the full economic stimulus payment last year and whose circumstances may have changed, making them eligible now for some or all of the unpaid portion.
Generally, a credit adds to the amount of a tax refund or decreases the amount of taxes owed. Therefore, the amount you receive for the recovery rebate credit will be included as part of your refund, as shown on your tax return. Unlike the 2008 economic stimulus payment, it will not be issued as a separate check.
You May Be Eligible
People who fall into the categories described below may be eligible for the recovery rebate credit this year:
Individuals who did not receive an economic stimulus payment.
Those who received less than the maximum economic stimulus payment in 2008 — $600 per taxpayer; $1,200 if married filing jointly — because their qualifying or gross income was either too high or too low.
Families who gained an additional qualifying child in 2008.
Individuals who could be claimed as a dependent on someone else’s tax return in 2007, but who cannot be claimed as a dependent on another return in 2008.
Individuals who did not have a valid Social Security number in 2007 but who did receive one in 2008.
How to Get the Recovery Rebate Credit
You need to claim the recovery rebate credit on Form 1040, 1040A or 1040EZ. The instructions for these forms will show you which lines to use. Unlike the economic stimulus payment, the recovery rebate credit will be included in your tax refund for 2008 and will not be issued as a separate payment.
The IRS Will Figure the Credit for You in Most Cases
You can choose to let the IRS do the work when you file your 2008 Form 1040, 1040A or 1040EZ. If you're filing on paper, simply follow the line-by-line instructions to choose this option. If you're filing electronically, the software will figure the credit for you.
Or You Can Figure It Yourself
Likewise, you can figure and claim the recovery rebate credit on your 2008 Form 1040, 1040A or 1040EZ. Two interactive online tools will be available to help you with the calculation, the Recovery Rebate Credit Calculator and How Much Was My 2008 Stimulus Payment?
The Recovery Rebate Credit Calculator will help you figure the amount you should claim on your 2008 tax return. Or, you can use the worksheet in the Form 1040 instruction booklet to help you figure your credit by hand. To use the Recovery Rebate Credit Calculator or complete the worksheet, you'll need the amount of the economic stimulus payment you received in 2008, if any. This amount was provided on Notice 1378, Economic Stimulus Payment Notice, sent by the IRS to taxpayers who received a payment.
You can use How Much Was My 2008 Stimulus Payment? to determine the amount you already received, if you don’t have or didn't receive Notice 1378.
If you still have some questions you can try the question and answer page.
For more information check out the Economic Stimulus Payment Information Center.
For help with tax liabilities check out this web site.
Generally, a credit adds to the amount of a tax refund or decreases the amount of taxes owed. Therefore, the amount you receive for the recovery rebate credit will be included as part of your refund, as shown on your tax return. Unlike the 2008 economic stimulus payment, it will not be issued as a separate check.
You May Be Eligible
People who fall into the categories described below may be eligible for the recovery rebate credit this year:
Individuals who did not receive an economic stimulus payment.
Those who received less than the maximum economic stimulus payment in 2008 — $600 per taxpayer; $1,200 if married filing jointly — because their qualifying or gross income was either too high or too low.
Families who gained an additional qualifying child in 2008.
Individuals who could be claimed as a dependent on someone else’s tax return in 2007, but who cannot be claimed as a dependent on another return in 2008.
Individuals who did not have a valid Social Security number in 2007 but who did receive one in 2008.
How to Get the Recovery Rebate Credit
You need to claim the recovery rebate credit on Form 1040, 1040A or 1040EZ. The instructions for these forms will show you which lines to use. Unlike the economic stimulus payment, the recovery rebate credit will be included in your tax refund for 2008 and will not be issued as a separate payment.
The IRS Will Figure the Credit for You in Most Cases
You can choose to let the IRS do the work when you file your 2008 Form 1040, 1040A or 1040EZ. If you're filing on paper, simply follow the line-by-line instructions to choose this option. If you're filing electronically, the software will figure the credit for you.
Or You Can Figure It Yourself
Likewise, you can figure and claim the recovery rebate credit on your 2008 Form 1040, 1040A or 1040EZ. Two interactive online tools will be available to help you with the calculation, the Recovery Rebate Credit Calculator and How Much Was My 2008 Stimulus Payment?
The Recovery Rebate Credit Calculator will help you figure the amount you should claim on your 2008 tax return. Or, you can use the worksheet in the Form 1040 instruction booklet to help you figure your credit by hand. To use the Recovery Rebate Credit Calculator or complete the worksheet, you'll need the amount of the economic stimulus payment you received in 2008, if any. This amount was provided on Notice 1378, Economic Stimulus Payment Notice, sent by the IRS to taxpayers who received a payment.
You can use How Much Was My 2008 Stimulus Payment? to determine the amount you already received, if you don’t have or didn't receive Notice 1378.
If you still have some questions you can try the question and answer page.
For more information check out the Economic Stimulus Payment Information Center.
For help with tax liabilities check out this web site.
Thursday, November 13, 2008
IRS Stimulus Checks Undeliverable
IRS Seeks to Return $266 Million in Undeliverable Refunds And Economic Stimulus Payments to Taxpayers
The Internal Revenue Service is looking for taxpayers who are missing more than 279,000 economic stimulus checks totaling about $163 million and more than 104,000 regular refund checks totaling about $103 million that were returned by the U.S. Postal Service due to mailing address errors.
“People across the country are missing tax refunds and stimulus checks. We want to get this money into the hands of taxpayers where it belongs,” said IRS Commissioner Doug Shulman. “We are committed to making the process as easy as possible for taxpayers to update their addresses with the IRS and get their checks.”
All a taxpayer has to do is update his or her address once. The IRS will then send out all checks due.
Stimulus Checks
It is crucial that taxpayers who may be due a stimulus check update their addresses with the IRS by Nov. 28, 2008. By law, economic stimulus checks must be sent out by Dec. 31 of this year. The undeliverable economic stimulus checks average $583.
The “Where’s My Stimulus Payment?" tool on the IRS Web site is the quickest and easiest way for a taxpayer to check the status of a stimulus check and receive instructions on how to update his or her address. Taxpayers without Internet access should call 1-866-234-2942.
Regular Refunds
The regular refund checks that were returned to the IRS average $988. These checks are resent as soon as taxpayers update their address.
Taxpayers can update their addresses with the “Where’s My Refund?” tool on the IRS Web site. It enables taxpayers to check the status of their refunds. A taxpayer must submit his or her social security number, filing status and amount of refund shown on their 2007 return. The tool will provide the status of their refund and in some cases provide instructions on how to resolve delivery problems.
Taxpayers checking on a refund over the phone will be given instructions on how to update their addresses. Taxpayers can access a telephone version of “Where’s My Refund?” by calling 1-800-829-1954.
Unsure?
Taxpayers not sure of which type of check they may be due should check on a potential economic stimulus check first because of the looming deadline. See instructions above.
For Most People
The vast majority of checks mailed out by the IRS reach their rightful owner every year. Only a very small percent are returned by the U.S. Postal Service as undeliverable.
Through September 2008, the government distributed 116 million economic stimulus payments with only about 279,000 checks being undeliverable. Meanwhile, the IRS has distributed more than 105 million regular refunds this year with only about 104,000 being undeliverable. In both cases, well under one percent of refunds or stimulus checks were undeliverable.
Avoiding Future Problems
The IRS encourages taxpayers to choose direct deposit when they file their return because it puts an end to lost, stolen or undeliverable checks. Taxpayers can receive refunds directly into personal checking or savings accounts. Direct deposit is available for filers of both paper and electronic returns.
The IRS also encourages taxpayers to file their tax returns electronically because e-file eliminates the risk of lost paper returns. E-file also reduces errors and speeds up refunds.
The Internal Revenue Service is looking for taxpayers who are missing more than 279,000 economic stimulus checks totaling about $163 million and more than 104,000 regular refund checks totaling about $103 million that were returned by the U.S. Postal Service due to mailing address errors.
“People across the country are missing tax refunds and stimulus checks. We want to get this money into the hands of taxpayers where it belongs,” said IRS Commissioner Doug Shulman. “We are committed to making the process as easy as possible for taxpayers to update their addresses with the IRS and get their checks.”
All a taxpayer has to do is update his or her address once. The IRS will then send out all checks due.
Stimulus Checks
It is crucial that taxpayers who may be due a stimulus check update their addresses with the IRS by Nov. 28, 2008. By law, economic stimulus checks must be sent out by Dec. 31 of this year. The undeliverable economic stimulus checks average $583.
The “Where’s My Stimulus Payment?" tool on the IRS Web site is the quickest and easiest way for a taxpayer to check the status of a stimulus check and receive instructions on how to update his or her address. Taxpayers without Internet access should call 1-866-234-2942.
Regular Refunds
The regular refund checks that were returned to the IRS average $988. These checks are resent as soon as taxpayers update their address.
Taxpayers can update their addresses with the “Where’s My Refund?” tool on the IRS Web site. It enables taxpayers to check the status of their refunds. A taxpayer must submit his or her social security number, filing status and amount of refund shown on their 2007 return. The tool will provide the status of their refund and in some cases provide instructions on how to resolve delivery problems.
Taxpayers checking on a refund over the phone will be given instructions on how to update their addresses. Taxpayers can access a telephone version of “Where’s My Refund?” by calling 1-800-829-1954.
Unsure?
Taxpayers not sure of which type of check they may be due should check on a potential economic stimulus check first because of the looming deadline. See instructions above.
For Most People
The vast majority of checks mailed out by the IRS reach their rightful owner every year. Only a very small percent are returned by the U.S. Postal Service as undeliverable.
Through September 2008, the government distributed 116 million economic stimulus payments with only about 279,000 checks being undeliverable. Meanwhile, the IRS has distributed more than 105 million regular refunds this year with only about 104,000 being undeliverable. In both cases, well under one percent of refunds or stimulus checks were undeliverable.
Avoiding Future Problems
The IRS encourages taxpayers to choose direct deposit when they file their return because it puts an end to lost, stolen or undeliverable checks. Taxpayers can receive refunds directly into personal checking or savings accounts. Direct deposit is available for filers of both paper and electronic returns.
The IRS also encourages taxpayers to file their tax returns electronically because e-file eliminates the risk of lost paper returns. E-file also reduces errors and speeds up refunds.
Sunday, October 12, 2008
New Law: Additional Military Families to Get Stimulus Payments This Fall
Married members of the military may receive economic stimulus payments this fall, even if their spouses or children don’t have social security numbers, following the newly-enacted HEART Act (Heroes Earnings Assistance and Relief Tax Act of 2008). Prior to this new legislation, some members of the military did not receive stimulus payments, or received a reduced amount, due to the absence of an SSN for a spouse or child.
In November, the Treasury will send checks and direct deposits to military families who qualify for these stimulus payments. The IRS estimates that there are more than 10,000 military families who will receive the additional stimulus payments. A specific time frame for the payments will be announced later this year.
"The IRS wants to make it as easy as possible for military families to get the stimulus payments authorized by the new law. People who already have filed don’t need to do anything else to get their money. We’ll do the rest,” said IRS Commissioner Doug Shulman. “We will work as quickly as possible to put these new provisions in place while making sure the rest of the stimulus payment program continues smoothly through the summer and fall."
To get a stimulus payment, eligible taxpayers must file a 2007 tax return. For married couples who have already filed a joint return, no further action is necessary. Generally, married couples qualify for an economic stimulus payment of up to $1,200, plus an additional $300 for each qualifying child younger than 17.
Because of the special challenges involved in making these newly-authorized payments, the IRS is taking the additional step of working with the Department of Defense to ensure that eligible filers get their money.
Originally, the Economic Stimulus Act of 2008 , enacted in February, barred economic-stimulus payments to anyone filing a return who did not have a social security number. Returns using any number issued by the IRS, such as an individual taxpayer identification number (ITIN) were not eligible. For joint filers, this meant that both spouses must use valid social security numbers.
Those barred by the original law from receiving a stimulus payment included military members filing jointly with spouses who were ineligible to get an SSN. In addition, because they were not eligible for stimulus payments, they could not receive an additional $300 payment for each eligible child.
Married couples filing joint returns who are now eligible for stimulus payments under the new law will receive a notice from the IRS telling them the amount of their payment and the date it will be issued. Payments will be made by check or direct deposit. Those who chose direct deposit for their regular tax refund will typically get their stimulus payment by direct deposit. However, anyone who chose a refund-anticipation loan, had tax-preparation fees deducted from their refund or entered into other refund-related transactions, will get a check, instead.
The payments are based on 2007 income tax returns, including basic returns filed by eligible low-income people, solely to claim a stimulus payment. Those who have not yet filed, including members of the military who received nontaxable combat pay, should do so as soon as possible.
In November, the Treasury will send checks and direct deposits to military families who qualify for these stimulus payments. The IRS estimates that there are more than 10,000 military families who will receive the additional stimulus payments. A specific time frame for the payments will be announced later this year.
"The IRS wants to make it as easy as possible for military families to get the stimulus payments authorized by the new law. People who already have filed don’t need to do anything else to get their money. We’ll do the rest,” said IRS Commissioner Doug Shulman. “We will work as quickly as possible to put these new provisions in place while making sure the rest of the stimulus payment program continues smoothly through the summer and fall."
To get a stimulus payment, eligible taxpayers must file a 2007 tax return. For married couples who have already filed a joint return, no further action is necessary. Generally, married couples qualify for an economic stimulus payment of up to $1,200, plus an additional $300 for each qualifying child younger than 17.
Because of the special challenges involved in making these newly-authorized payments, the IRS is taking the additional step of working with the Department of Defense to ensure that eligible filers get their money.
Originally, the Economic Stimulus Act of 2008 , enacted in February, barred economic-stimulus payments to anyone filing a return who did not have a social security number. Returns using any number issued by the IRS, such as an individual taxpayer identification number (ITIN) were not eligible. For joint filers, this meant that both spouses must use valid social security numbers.
Those barred by the original law from receiving a stimulus payment included military members filing jointly with spouses who were ineligible to get an SSN. In addition, because they were not eligible for stimulus payments, they could not receive an additional $300 payment for each eligible child.
Married couples filing joint returns who are now eligible for stimulus payments under the new law will receive a notice from the IRS telling them the amount of their payment and the date it will be issued. Payments will be made by check or direct deposit. Those who chose direct deposit for their regular tax refund will typically get their stimulus payment by direct deposit. However, anyone who chose a refund-anticipation loan, had tax-preparation fees deducted from their refund or entered into other refund-related transactions, will get a check, instead.
The payments are based on 2007 income tax returns, including basic returns filed by eligible low-income people, solely to claim a stimulus payment. Those who have not yet filed, including members of the military who received nontaxable combat pay, should do so as soon as possible.
Stimulus Checks for Military Combat Personel
This section is for military personnel who are serving in combat zones.
For federal tax purposes, the U.S. Armed Forces includes officers and enlisted personnel in all regular and reserve units controlled by the Secretaries of Defense, the Army, Navy and Air Force. The Coast Guard and National Guard are also included, but not the U.S. Merchant Marine or the American Red Cross.
Normally, combat pay is not counted as income and is not taxable. For the purposes of receiving an economic stimulus payment, however, military personnel serving in combat zones have the option of including their nontaxable combat pay on their 2007 or 2008 income tax returns if it helps their eligibility for the 2008 economic stimulus payments.
To receive the stimulus payment this year, combat zone personnel or their spouses must file a tax year 2007 income tax return by Oct. 15, 2008. Otherwise, they can claim the economic stimulus payment on next year’s income tax return.
Military personnel who normally would not file an income tax return because their 2007 income is not taxable can file a simple Form 1040A with the IRS if they want to receive the economic stimulus payment. They should report their nontaxable combat pay on line 40b of the Form 1040A to show at least $3,000 in qualifying income. The Department of Defense lists the amount of excluded combat pay, along with the designation, “Code Q,” in box 12 of Form W-2.
The IRS has developed Package 1040A-3, an 8-page publication containing tax tips, a sample Form 1040A and a blank Form 1040A. The package contains everything needed to file the return immediately.
Package 1040A-3 , 8-page information package
Basic Eligibility Requirements
You have, or your family has, at least $3,000 in qualifying income from, or in combination with, Social Security benefits, certain Veterans Affairs benefits, Railroad Retirement benefits and earned income. Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.
You are not a dependent or eligible to be a dependent on someone else’s federal tax return. (The same must be true of any family members claimed on your return.)
Due to a new law change, the spouses and children of married military personnel are not required to have valid Social Security Numbers.
To Claim Your Payment
If you normally don’t file a federal tax return but must file one this year solely to claim your economic stimulus payment, you should file by Oct. 15, 2008, to ensure that you receive the payment this year.
Find out where to send your tax return.
It will generally take a minimum of eight weeks after you file your return to get your stimulus payment.
Free Tax Help Available
Individuals who need to file a return this year to receive a stimulus payment may be able to take advantage of free tax preparation sites nationwide for low-income and older taxpayers.
Free File - Economic Stimulus Payment provides free tax preparation software and electronic filing for people who are submitting a return solely to receive their economic stimulus payment
The Volunteer Income Tax Assistance (VITA) program provides help to low- and moderate-income taxpayers. Call 1-800-906-9887 to locate the nearest VITA site.
IRS employees will help prepare Form 1040A returns for low-income workers, retirees, disabled veterans and others at IRS Taxpayer Assistance Centers. For a list of centers in your state and their hours of operation, Contact My Local Office.
For federal tax purposes, the U.S. Armed Forces includes officers and enlisted personnel in all regular and reserve units controlled by the Secretaries of Defense, the Army, Navy and Air Force. The Coast Guard and National Guard are also included, but not the U.S. Merchant Marine or the American Red Cross.
Normally, combat pay is not counted as income and is not taxable. For the purposes of receiving an economic stimulus payment, however, military personnel serving in combat zones have the option of including their nontaxable combat pay on their 2007 or 2008 income tax returns if it helps their eligibility for the 2008 economic stimulus payments.
To receive the stimulus payment this year, combat zone personnel or their spouses must file a tax year 2007 income tax return by Oct. 15, 2008. Otherwise, they can claim the economic stimulus payment on next year’s income tax return.
Military personnel who normally would not file an income tax return because their 2007 income is not taxable can file a simple Form 1040A with the IRS if they want to receive the economic stimulus payment. They should report their nontaxable combat pay on line 40b of the Form 1040A to show at least $3,000 in qualifying income. The Department of Defense lists the amount of excluded combat pay, along with the designation, “Code Q,” in box 12 of Form W-2.
The IRS has developed Package 1040A-3, an 8-page publication containing tax tips, a sample Form 1040A and a blank Form 1040A. The package contains everything needed to file the return immediately.
Package 1040A-3 , 8-page information package
Basic Eligibility Requirements
You have, or your family has, at least $3,000 in qualifying income from, or in combination with, Social Security benefits, certain Veterans Affairs benefits, Railroad Retirement benefits and earned income. Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.
You are not a dependent or eligible to be a dependent on someone else’s federal tax return. (The same must be true of any family members claimed on your return.)
Due to a new law change, the spouses and children of married military personnel are not required to have valid Social Security Numbers.
To Claim Your Payment
If you normally don’t file a federal tax return but must file one this year solely to claim your economic stimulus payment, you should file by Oct. 15, 2008, to ensure that you receive the payment this year.
Find out where to send your tax return.
It will generally take a minimum of eight weeks after you file your return to get your stimulus payment.
Free Tax Help Available
Individuals who need to file a return this year to receive a stimulus payment may be able to take advantage of free tax preparation sites nationwide for low-income and older taxpayers.
Free File - Economic Stimulus Payment provides free tax preparation software and electronic filing for people who are submitting a return solely to receive their economic stimulus payment
The Volunteer Income Tax Assistance (VITA) program provides help to low- and moderate-income taxpayers. Call 1-800-906-9887 to locate the nearest VITA site.
IRS employees will help prepare Form 1040A returns for low-income workers, retirees, disabled veterans and others at IRS Taxpayer Assistance Centers. For a list of centers in your state and their hours of operation, Contact My Local Office.
Thursday, October 2, 2008
Top 5 FAQs About Your Stimulus Payment
Here are the top five questions currently being asked about the stimulus payments. Perhaps one of them is your question.
Address Change
1) I have moved since filing my 2007 tax return. How will my payment reach me?
A. Filing Form 8822, Change of Address, with the IRS and a change of address notice with the U.S. Postal Service will help ensure that any mail from the IRS, including your stimulus payment check, is sent to your new address. If the check has already been mailed and you did not provide the IRS with an updated address, the check will most likely be returned to the IRS. You may call the IRS at 1-866-234-2942 to provide your new address so that steps can be taken to have the check reissued.
Payment Timing
2) When will I get my stimulus payment?
A. It will generally take 8-12 weeks after you file your return to get your stimulus payment.
The IRS has already issued stimulus payments, both direct deposits and paper checks, for most returns filed by April 15. The IRS will continue to issue payments through 2008 for returns filed after April 15. Please allow 8-12 weeks after filing your tax return before checking on the status of your stimulus payment. To check on the status of your stimulus payment, you may visit Where's My Stimulus Payment?or call the toll-free Rebate Hotline at 1-866-234-2942.
Haven't Received My Check Yet
3) It has been more than eight weeks since I filed my return and my payment has not arrived. Can the IRS trace my payment to find out what happened to it?
A. Yes. If it has been more than eight weeks since you filed your return and your payment has not arrived, please visit an IRS Taxpayer Assistence Center or call the toll-free Rebate Hotline at 1-866-234-2942. A list of all Taxpayer Assistance Centers in your state is available at Contact My Local Office.
Is It Too Late?
4) I heard that the IRS has finished sending the stimulus payments. Is it too late to for me to claim mine?
A. It's not too late. There's still time to file and claim your economic stimulus payment. The IRS will continue processing tax returns and issuing stimulus checks for much of the year. Social Security recipients and veterans who don't normally need to file returns, as well as people who received extensions for filing, should file by Oct. 15, 2008, to make sure they receive a payment before the end of the year
Late Filed Returns
5) I filed after April 15 and the payment date for my Social Security number has passed. How long will it take for me to get my stimulus payment?
A. It will generally take 8-12 weeks after you file your return to get your stimulus payment.
Address Change
1) I have moved since filing my 2007 tax return. How will my payment reach me?
A. Filing Form 8822, Change of Address, with the IRS and a change of address notice with the U.S. Postal Service will help ensure that any mail from the IRS, including your stimulus payment check, is sent to your new address. If the check has already been mailed and you did not provide the IRS with an updated address, the check will most likely be returned to the IRS. You may call the IRS at 1-866-234-2942 to provide your new address so that steps can be taken to have the check reissued.
Payment Timing
2) When will I get my stimulus payment?
A. It will generally take 8-12 weeks after you file your return to get your stimulus payment.
The IRS has already issued stimulus payments, both direct deposits and paper checks, for most returns filed by April 15. The IRS will continue to issue payments through 2008 for returns filed after April 15. Please allow 8-12 weeks after filing your tax return before checking on the status of your stimulus payment. To check on the status of your stimulus payment, you may visit Where's My Stimulus Payment?or call the toll-free Rebate Hotline at 1-866-234-2942.
Haven't Received My Check Yet
3) It has been more than eight weeks since I filed my return and my payment has not arrived. Can the IRS trace my payment to find out what happened to it?
A. Yes. If it has been more than eight weeks since you filed your return and your payment has not arrived, please visit an IRS Taxpayer Assistence Center or call the toll-free Rebate Hotline at 1-866-234-2942. A list of all Taxpayer Assistance Centers in your state is available at Contact My Local Office.
Is It Too Late?
4) I heard that the IRS has finished sending the stimulus payments. Is it too late to for me to claim mine?
A. It's not too late. There's still time to file and claim your economic stimulus payment. The IRS will continue processing tax returns and issuing stimulus checks for much of the year. Social Security recipients and veterans who don't normally need to file returns, as well as people who received extensions for filing, should file by Oct. 15, 2008, to make sure they receive a payment before the end of the year
Late Filed Returns
5) I filed after April 15 and the payment date for my Social Security number has passed. How long will it take for me to get my stimulus payment?
A. It will generally take 8-12 weeks after you file your return to get your stimulus payment.
Tuesday, September 16, 2008
Its not too Late to File and get Your Stimulus Payment
If you haven't yet filed a tax return to get your stimulus payment, you still have time to do so. But you must file by Oct. 15 to get your payment this year. And if you've already filed to get your payment but have a question or issue, it might be addressed here.
Find the Answer
Still looking for your rebate even though you've already filed a tax return? Or wonder why it's smaller than you were expecting? You may find the answer to your question in our:
• Top five questions people are asking
• Frequently asked questions about eligibility, payment amounts, payment delivery and more
If You've Already Filed a Tax Return
You may have already filed but still have outstanding issues. Find out more if you:
• Haven’t gotten your economic stimulus payment,
• Received one for a different amount than you were expecting,
• Amended your tax return,
• Changed your address, or
• Are in the military, have a spouse or children with ITINs instead of valid SSNs and received a reduced or no stimulus payment
If you still have questions, try:
• The IRS' online tool that tells you if your payment has been scheduled for delivery the upcoming week, Where's My Stimulus Payment?
• The Rebate Hotline at 1-866-234-2942
If You Haven't Yet Filed a Tax Return
If you haven’t filed a federal tax return to claim your economic stimulus payment, you have until Oct. 15 to file to get your payment this year.
Find out more if you:
• Receive Social Security retirement or disability benefits
• Receive Veterans Affairs pension, disability or survivor's benefits
• Receive Tier 1 Railroad Retirement benefits
• Are a low-wage worker, or Filed for an extension of time to file your return.
Get Basic Information
If you're not sure what the payment is all about, read the basic information.
Find Out if You're Eligible
You are eligible if:
• You or your family has at least $3,000 in qualifying income from, or in combination with, Social Security benefits, Veterans Affairs benefits, Railroad Retirement benefits and earned income. Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.
• You and any family members listed on your tax return have valid Social Security numbers.
• You are not a dependent or eligible to be a dependent on someone else’s federal tax return. (The same must be true of any family members claimed on your return.)
Calculate How Much You May Get
Eligible individuals — between $300 and $600
Joint filers — between $600 and $1,200
With eligible children — an additional $300 for each qualifying child
The actual amount depends on the information on your tax return. To find out how much you might be eligible for, use the economic stimulus calculator.
Find Out When You'll Get Your Payment
Whether you've already filed, have yet to file or filed for an extension, find out when you can expect to receive your stimulus payment.
Claim Your Payment...
Complete a federal tax return this year, even if you don’t normally do so. For instructions, a sample Form 1040A and a blank Form 1040A, see our 8-page informational package. Or use the longer Form 1040 and its instructions.
Then...
File electronically. For free free tax preparation software and electronic filing for people submitting a return solely to receive their stimulus payment, use Free File: Economic Stimulus Payment.
Or...
Mail a paper tax return to the IRS based on where you live.
Choose Direct Deposit or Paper Check
You can get your payment electronically as a direct deposit into your checking or savings account by filling in lines 44 b, c and d on Form 1040A or lines 74 b, c and d on Form 1040. Or you can get a paper check by leaving those lines blank.
Get Free Help at Taxpayer Assistance Centers
IRS employees will help prepare Form 1040A returns for low-income workers, retirees, disabled veterans and others. For a list of centers in your state and their hours of operation, Contact My Local Office .
Information For Businesses
Information on the business provisions of the economic stimulus payment.
For More Information
Check out our:
news releases, audio files, fact sheets and legal guidance
Flyers, public service announcements and other marketing products for IRS's partners and others
Avoid Rebate Scams
Identity thieves are using the stimulus payment as bait in their scams. Details can be found in news release IR-2008-11, IRS Warns of New E-Mail and Telephone Scams Using the IRS Name; Advance Payment Scams Starting.
Find the Answer
Still looking for your rebate even though you've already filed a tax return? Or wonder why it's smaller than you were expecting? You may find the answer to your question in our:
• Top five questions people are asking
• Frequently asked questions about eligibility, payment amounts, payment delivery and more
If You've Already Filed a Tax Return
You may have already filed but still have outstanding issues. Find out more if you:
• Haven’t gotten your economic stimulus payment,
• Received one for a different amount than you were expecting,
• Amended your tax return,
• Changed your address, or
• Are in the military, have a spouse or children with ITINs instead of valid SSNs and received a reduced or no stimulus payment
If you still have questions, try:
• The IRS' online tool that tells you if your payment has been scheduled for delivery the upcoming week, Where's My Stimulus Payment?
• The Rebate Hotline at 1-866-234-2942
If You Haven't Yet Filed a Tax Return
If you haven’t filed a federal tax return to claim your economic stimulus payment, you have until Oct. 15 to file to get your payment this year.
Find out more if you:
• Receive Social Security retirement or disability benefits
• Receive Veterans Affairs pension, disability or survivor's benefits
• Receive Tier 1 Railroad Retirement benefits
• Are a low-wage worker, or Filed for an extension of time to file your return.
Get Basic Information
If you're not sure what the payment is all about, read the basic information.
Find Out if You're Eligible
You are eligible if:
• You or your family has at least $3,000 in qualifying income from, or in combination with, Social Security benefits, Veterans Affairs benefits, Railroad Retirement benefits and earned income. Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.
• You and any family members listed on your tax return have valid Social Security numbers.
• You are not a dependent or eligible to be a dependent on someone else’s federal tax return. (The same must be true of any family members claimed on your return.)
Calculate How Much You May Get
Eligible individuals — between $300 and $600
Joint filers — between $600 and $1,200
With eligible children — an additional $300 for each qualifying child
The actual amount depends on the information on your tax return. To find out how much you might be eligible for, use the economic stimulus calculator.
Find Out When You'll Get Your Payment
Whether you've already filed, have yet to file or filed for an extension, find out when you can expect to receive your stimulus payment.
Claim Your Payment...
Complete a federal tax return this year, even if you don’t normally do so. For instructions, a sample Form 1040A and a blank Form 1040A, see our 8-page informational package. Or use the longer Form 1040 and its instructions.
Then...
File electronically. For free free tax preparation software and electronic filing for people submitting a return solely to receive their stimulus payment, use Free File: Economic Stimulus Payment.
Or...
Mail a paper tax return to the IRS based on where you live.
Choose Direct Deposit or Paper Check
You can get your payment electronically as a direct deposit into your checking or savings account by filling in lines 44 b, c and d on Form 1040A or lines 74 b, c and d on Form 1040. Or you can get a paper check by leaving those lines blank.
Get Free Help at Taxpayer Assistance Centers
IRS employees will help prepare Form 1040A returns for low-income workers, retirees, disabled veterans and others. For a list of centers in your state and their hours of operation, Contact My Local Office .
Information For Businesses
Information on the business provisions of the economic stimulus payment.
For More Information
Check out our:
news releases, audio files, fact sheets and legal guidance
Flyers, public service announcements and other marketing products for IRS's partners and others
Avoid Rebate Scams
Identity thieves are using the stimulus payment as bait in their scams. Details can be found in news release IR-2008-11, IRS Warns of New E-Mail and Telephone Scams Using the IRS Name; Advance Payment Scams Starting.
Wednesday, September 10, 2008
Avoid Errors That Can Delay Your Stimulus Payment
People Can Avoid Common Errors that Delay Stimulus Payments
IR-2008-103, Sept. 9, 2008 WASHINGTON — People who are awaiting an economic stimulus payment or who have yet to file can avoid common errors that may delay their payment. They also can use the IRS Web site to answer most common questions.
The Internal Revenue Service, which is still issuing economic stimulus payments, has been studying trends and common issues in filing errors and questions posed by people calling its customer service telephone lines.The most common question posed to the IRS is from people wondering when they will receive their stimulus payment. The question can be answered easily by going to IRS.gov and using the “Where’s My Economic Stimulus Payment?” Web tool.
Here’s how to avoid common mistakes:
File only one tax return – People should file only one 2007 tax return. It takes the IRS up to 12 weeks to process paper returns and issue the stimulus payments. However, some people are filing more than one tax return in an effort to receive a stimulus payment, which could further delay their stimulus payment. The IRS is concerned there will be more multiple filings as the October 15 deadline approaches for filing a return in 2008.
List qualifying income – Some people are listing their monthly income instead of annual income. People must list their annual amount of qualifying income to be eligible for the minimum payment of $300 ($600 married filing jointly.) The qualifying income required by law is at least $3,000 in benefits from Social Security, Veterans Affairs and Railroad Retirement, earned income and/or combat pay.
Review Your Tax Liability – Some people who have either small amounts of tax liability or no tax liability are getting smaller stimulus payments than they expected or none at all. Generally, the law provided for a maximum stimulus payment of $600 ($1,200 for married couples) or an amount equal to a taxpayer’s tax liability, whichever was less. Tax liability is the net amount of federal income taxes paid after deductions and credits. If people had no tax liability but had at least $3,000 of “qualifying income” from specific sources, they would be eligible for $300 ($600 for married couples.) There also is a $300 payment for each qualifying child.
Amended return – Generally, people cannot file an amended return solely to get an economic stimulus payment unless they are a retiree, veteran or have other “qualifying income.” While amended returns will be processed to correct the income, deductions and income tax as appropriate, the economic stimulus payment amount will not be adjusted based on an amended return. If people do not receive a payment this year, they can claim it when they file their tax return in 2009.
Use Most Current Address – People must use their most current address in order to receive a timely payment. People who change addresses after filing should complete Form 8822 and a change of address card with the U.S. Postal Service. If the postal service is unable to deliver the payment, it is returned to the IRS.
People must file a 2007 tax return by October 15 in order to receive the economic stimulus payment this year, even if they normally do not have a filing requirement because their income is too low or not taxable. The IRS already has issued 90 percent of the economic stimulus payments but will continue to issue payments through December.
For people who filed a 2007 tax return eight to 12 weeks ago but who have not received a payment, the quickest and easiest way to track the status of the payment is to go to “Where’s My Economic Stimulus Payment?” on IRS.gov. The online tool will report when the payment has been issued. People will need their Social Security Number, their filing status and the number of exemptions claimed on their tax return to use this tool.
The IRS online tool also can report other issues, such as ineligibility because income was too high or the returning of an undeliverable payment to the IRS.
The economic stimulus payment begins to phase out for individuals whose income is $75,000 or more and for joint returns with income of $150,000 or more. To be eligible, a person cannot be a dependent or eligible to be a dependent of another person. To be eligible, an individual must have a valid Social Security Number unless his or her spouse serves in the military.
Supplemental Security Income (SSI) does not count as “qualifying income” for stimulus payment purposes. The biggest mistake of all would be failing to file a 2007 return in order to receive the stimulus payment, especially for people who are eligible but who do not normally file a tax return because their income is low or nontaxable. People in this category can use a Form 1040A, provide a little information to complete the return and send it to the IRS by October 15. People also are urged to help friends, family or neighbors who may be in this category and unaware of their eligibility.
People who do not file a tax return by October 15 can still obtain their economic stimulus payments when they file their 2008 tax return. If they wait until next year to file, their payments will be based on their 2008 income and personal situations rather than on 2007 information.
Foy questions with help cpncerning taxes or taxes owed, look into contacting a tax resolution firm to help you.
IR-2008-103, Sept. 9, 2008 WASHINGTON — People who are awaiting an economic stimulus payment or who have yet to file can avoid common errors that may delay their payment. They also can use the IRS Web site to answer most common questions.
The Internal Revenue Service, which is still issuing economic stimulus payments, has been studying trends and common issues in filing errors and questions posed by people calling its customer service telephone lines.The most common question posed to the IRS is from people wondering when they will receive their stimulus payment. The question can be answered easily by going to IRS.gov and using the “Where’s My Economic Stimulus Payment?” Web tool.
Here’s how to avoid common mistakes:
File only one tax return – People should file only one 2007 tax return. It takes the IRS up to 12 weeks to process paper returns and issue the stimulus payments. However, some people are filing more than one tax return in an effort to receive a stimulus payment, which could further delay their stimulus payment. The IRS is concerned there will be more multiple filings as the October 15 deadline approaches for filing a return in 2008.
List qualifying income – Some people are listing their monthly income instead of annual income. People must list their annual amount of qualifying income to be eligible for the minimum payment of $300 ($600 married filing jointly.) The qualifying income required by law is at least $3,000 in benefits from Social Security, Veterans Affairs and Railroad Retirement, earned income and/or combat pay.
Review Your Tax Liability – Some people who have either small amounts of tax liability or no tax liability are getting smaller stimulus payments than they expected or none at all. Generally, the law provided for a maximum stimulus payment of $600 ($1,200 for married couples) or an amount equal to a taxpayer’s tax liability, whichever was less. Tax liability is the net amount of federal income taxes paid after deductions and credits. If people had no tax liability but had at least $3,000 of “qualifying income” from specific sources, they would be eligible for $300 ($600 for married couples.) There also is a $300 payment for each qualifying child.
Amended return – Generally, people cannot file an amended return solely to get an economic stimulus payment unless they are a retiree, veteran or have other “qualifying income.” While amended returns will be processed to correct the income, deductions and income tax as appropriate, the economic stimulus payment amount will not be adjusted based on an amended return. If people do not receive a payment this year, they can claim it when they file their tax return in 2009.
Use Most Current Address – People must use their most current address in order to receive a timely payment. People who change addresses after filing should complete Form 8822 and a change of address card with the U.S. Postal Service. If the postal service is unable to deliver the payment, it is returned to the IRS.
People must file a 2007 tax return by October 15 in order to receive the economic stimulus payment this year, even if they normally do not have a filing requirement because their income is too low or not taxable. The IRS already has issued 90 percent of the economic stimulus payments but will continue to issue payments through December.
For people who filed a 2007 tax return eight to 12 weeks ago but who have not received a payment, the quickest and easiest way to track the status of the payment is to go to “Where’s My Economic Stimulus Payment?” on IRS.gov. The online tool will report when the payment has been issued. People will need their Social Security Number, their filing status and the number of exemptions claimed on their tax return to use this tool.
The IRS online tool also can report other issues, such as ineligibility because income was too high or the returning of an undeliverable payment to the IRS.
The economic stimulus payment begins to phase out for individuals whose income is $75,000 or more and for joint returns with income of $150,000 or more. To be eligible, a person cannot be a dependent or eligible to be a dependent of another person. To be eligible, an individual must have a valid Social Security Number unless his or her spouse serves in the military.
Supplemental Security Income (SSI) does not count as “qualifying income” for stimulus payment purposes. The biggest mistake of all would be failing to file a 2007 return in order to receive the stimulus payment, especially for people who are eligible but who do not normally file a tax return because their income is low or nontaxable. People in this category can use a Form 1040A, provide a little information to complete the return and send it to the IRS by October 15. People also are urged to help friends, family or neighbors who may be in this category and unaware of their eligibility.
People who do not file a tax return by October 15 can still obtain their economic stimulus payments when they file their 2008 tax return. If they wait until next year to file, their payments will be based on their 2008 income and personal situations rather than on 2007 information.
Foy questions with help cpncerning taxes or taxes owed, look into contacting a tax resolution firm to help you.
IRS Stimulus Checks for Seniors and Retirees
You Must File a 2007 Federal Income Tax Return to get your Stimulus Payment
Even if you aren’t normally required to file a federal income tax return, you must file one if you want to be among the 130 million individuals who will receive a check from Treasury beginning in May of this year. The IRS will use information on the 2007 tax return filed by the taxpayer to determine eligibility and calculate the amount of the stimulus payment.
In most cases, payments will range from $300 to $600 for individuals and $600 to $1200 for joint filers. Parents and anyone else eligible for a stimulus payment will also receive an additional $300 for each qualifying child (subject to income phase-outs).
“We want to make sure everyone who is eligible for these payments receives them,” says IRS Executive Julie Rushin. “Most eligible taxpayers do not need to take any extra steps to receive the payment. All they have to do is file a 2007 federal tax return and the IRS will automatically do the rest. No other action, extra form or call is necessary.”
You Must Have a Valid Social Security Number
Taxpayers must have a valid Social Security Number to qualify for the stimulus payment. If married filing jointly, both taxpayers must have a valid Social Security Number. Children must be eligible under the Child Tax Credit and must also have a valid Social Security Number to be eligible as qualifying children.
You Must File a 2007 Federal Income Tax Return, Even if You Normally Would Not
Low-income workers who had at least $3,000 in earned income (such as wages) and other qualifying income in 2007 but do not otherwise earn enough to be required to file a federal tax return need to file a return to qualify for the stimulus payment. Other qualifying income includes Social Security benefits, certain Railroad Retirement benefits, or certain veterans’ benefits.
Certain Benefits Count toward Your Qualifying Income
Normally, Social Security benefits, certain Railroad Retirement benefits and veterans’ disability compensation, pension or survivors’ benefits received from the Department of Veterans Affairs are not subject to income tax. However, the economic stimulus law passed in February contains special provisions allowing recipients of these non-taxable benefits to count them toward the qualifying income requirement of $3,000 and thereby qualify for the stimulus payment.
However, Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.
This means if you had, for example, $500 in wages and $2,500 in any combination of the benefits described above, you can add these together to reach the $3,000 qualifying income requirement.
For purposes of meeting the qualifying income requirement, the following benefits need to be reported in any combination on line 20a of U.S. Individual Income Tax Return Form 1040 or Line 14a of the Form 1040A:Social Security benefits reported in box 5 of the 2007 Form 1099-SSA, which people should have received in January. Taxpayers who do not have a Form 1099 may also estimate their annual Social Security benefit by taking their monthly benefit, multiplying it by the number of months during the year they received the benefits, and entering the number on line 20a of Form 1040 or Line 14a of the Form 1040A.
Certain Railroad Retirement benefits reported in box 5 of the 2007 Form 1099-RRB, which recipients would have received in January.
The sum of certain veterans’ disability benefits received in 2007, including veterans’ disability compensation, pension or survivors’ benefits received from the Department of Veterans Affairs. Taxpayers who weren’t required to file a tax return can estimate their annual veterans’ benefits by taking their monthly benefit, multiplying it by the number of months during the year they received payments, and entering the number on line 20a of Form 1040 or Line 14a of the Form 1040A.
Have You Already Filed Your 2007 Federal Income Tax Return?
If you are a recipient of the benefits described above and have already filed your 2007 tax return reporting at least $3,000 in qualifying income, you do not need to do anything else. The Treasury will automatically begin sending taxpayers their payments in early May.
Otherwise you may need to amend a previously filed tax return to include benefits to reach the $3,000 qualifying income level. You can use IRS Form 1040X to amend a tax return in order to qualify for the stimulus payment. Adding these benefits on an amended tax return will not increase your tax liability but will establish eligibility for the stimulus payment.
Stimulus payments will be direct deposited for taxpayers selecting that option when filing their 2007 tax returns. Taxpayers who have already filed with direct deposit won't need to do anything else to receive the stimulus payment. For taxpayers who haven't filed their 2007 returns yet, the IRS reminds them that direct deposit is the fastest way to get both regular refunds and stimulus payments.
Some are Not Eligible for Stimulus Payments
Anyone who does not have a valid Social Security Number including those who file using an Individual Tax Identification Number (ITIN), an Adoption Taxpayer Identification Number (ATIN) or any other identification number issued by the IRS is not eligible for this payment. Also ineligible are individuals who can be claimed as dependents on someone else’s return, or taxpayers who file Form 1040-NR, 1040-PR or 1040-SS.
The above is information supplied by the IRS website.
You can get help preparing and filing your taxes or help in resolving an IRS issue by finding a reputable tax resolution firm.
Even if you aren’t normally required to file a federal income tax return, you must file one if you want to be among the 130 million individuals who will receive a check from Treasury beginning in May of this year. The IRS will use information on the 2007 tax return filed by the taxpayer to determine eligibility and calculate the amount of the stimulus payment.
In most cases, payments will range from $300 to $600 for individuals and $600 to $1200 for joint filers. Parents and anyone else eligible for a stimulus payment will also receive an additional $300 for each qualifying child (subject to income phase-outs).
“We want to make sure everyone who is eligible for these payments receives them,” says IRS Executive Julie Rushin. “Most eligible taxpayers do not need to take any extra steps to receive the payment. All they have to do is file a 2007 federal tax return and the IRS will automatically do the rest. No other action, extra form or call is necessary.”
You Must Have a Valid Social Security Number
Taxpayers must have a valid Social Security Number to qualify for the stimulus payment. If married filing jointly, both taxpayers must have a valid Social Security Number. Children must be eligible under the Child Tax Credit and must also have a valid Social Security Number to be eligible as qualifying children.
You Must File a 2007 Federal Income Tax Return, Even if You Normally Would Not
Low-income workers who had at least $3,000 in earned income (such as wages) and other qualifying income in 2007 but do not otherwise earn enough to be required to file a federal tax return need to file a return to qualify for the stimulus payment. Other qualifying income includes Social Security benefits, certain Railroad Retirement benefits, or certain veterans’ benefits.
Certain Benefits Count toward Your Qualifying Income
Normally, Social Security benefits, certain Railroad Retirement benefits and veterans’ disability compensation, pension or survivors’ benefits received from the Department of Veterans Affairs are not subject to income tax. However, the economic stimulus law passed in February contains special provisions allowing recipients of these non-taxable benefits to count them toward the qualifying income requirement of $3,000 and thereby qualify for the stimulus payment.
However, Supplemental Security Income (SSI) does not count as qualifying income for the stimulus payment.
This means if you had, for example, $500 in wages and $2,500 in any combination of the benefits described above, you can add these together to reach the $3,000 qualifying income requirement.
For purposes of meeting the qualifying income requirement, the following benefits need to be reported in any combination on line 20a of U.S. Individual Income Tax Return Form 1040 or Line 14a of the Form 1040A:Social Security benefits reported in box 5 of the 2007 Form 1099-SSA, which people should have received in January. Taxpayers who do not have a Form 1099 may also estimate their annual Social Security benefit by taking their monthly benefit, multiplying it by the number of months during the year they received the benefits, and entering the number on line 20a of Form 1040 or Line 14a of the Form 1040A.
Certain Railroad Retirement benefits reported in box 5 of the 2007 Form 1099-RRB, which recipients would have received in January.
The sum of certain veterans’ disability benefits received in 2007, including veterans’ disability compensation, pension or survivors’ benefits received from the Department of Veterans Affairs. Taxpayers who weren’t required to file a tax return can estimate their annual veterans’ benefits by taking their monthly benefit, multiplying it by the number of months during the year they received payments, and entering the number on line 20a of Form 1040 or Line 14a of the Form 1040A.
Have You Already Filed Your 2007 Federal Income Tax Return?
If you are a recipient of the benefits described above and have already filed your 2007 tax return reporting at least $3,000 in qualifying income, you do not need to do anything else. The Treasury will automatically begin sending taxpayers their payments in early May.
Otherwise you may need to amend a previously filed tax return to include benefits to reach the $3,000 qualifying income level. You can use IRS Form 1040X to amend a tax return in order to qualify for the stimulus payment. Adding these benefits on an amended tax return will not increase your tax liability but will establish eligibility for the stimulus payment.
Stimulus payments will be direct deposited for taxpayers selecting that option when filing their 2007 tax returns. Taxpayers who have already filed with direct deposit won't need to do anything else to receive the stimulus payment. For taxpayers who haven't filed their 2007 returns yet, the IRS reminds them that direct deposit is the fastest way to get both regular refunds and stimulus payments.
Some are Not Eligible for Stimulus Payments
Anyone who does not have a valid Social Security Number including those who file using an Individual Tax Identification Number (ITIN), an Adoption Taxpayer Identification Number (ATIN) or any other identification number issued by the IRS is not eligible for this payment. Also ineligible are individuals who can be claimed as dependents on someone else’s return, or taxpayers who file Form 1040-NR, 1040-PR or 1040-SS.
The above is information supplied by the IRS website.
You can get help preparing and filing your taxes or help in resolving an IRS issue by finding a reputable tax resolution firm.
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