Tax Rebate - 3/07/08

Jeff: Congress has decided to pump up the economy by giving taxpayers a check.  So are you eligible?  And what do you have to do to get your free money?  Here to answer these questions is attorney Michael Solomon.

Jeff: Who’s eligible for a rebate check? 

Mike: If you owed taxes for 2007, you should be eligible for a rebate check.  But not if your income was too high.  The rebates phase out for taxpayers with adjusted gross income above $75,000 or $150,000 for married couples filing jointly.  Basically this means for single person with no children if your adjusted gross income is $87,000 or more, no rebate.  For married couple with no children no rebate if your adjusted gross income is above $174,000. 

Jeff:  How much is the rebate check?

Mike:  You will be entitled to a rebate check up to your 2007 tax liability not exceeding to $600 for an individual and $1200 for married couples filing jointly. You also receive an additional $300 for each dependent child under 17.  So if you are married with two young kids, you would get $1800.00, as long as you owed at least that much in taxes.

One of the strange parts of the tax law is that if you don’t qualify for the rebate now because your 2007 income was too high, you can try again next year, using your 2008 income.

Jeff: How do we get our checks?

Mike: All you have to do is file your 2007 tax return.

Jeff:  Can we still get a check if we didn’t have any income or owe any tax? 

Mike:  Yes.  A single person can receive $300 and a married couple filing jointly $600 dollars if they have “qualifying income” of at least $3000.  Qualifying income means salary, wages, social security income, and certain veterans pension benefits.  This means that some people who never even need to file an income tax return can qualify for the rebate.  But they’ll have to file a 1040A tax return which is a simpler income tax return.  At the top of it write “stimulus payment”.  Then just fill in your name, address, social  security number and some basic information regarding your  income, and the IRS will calculate your  rebate.

Jeff:  This all seems complicated.  What should a person do to make sure they receive what they’re entitled to.

Mike:  If you normally file an income tax turn in 2007 your tax preparer should be able handle this matter for you.  If you don’t file a tax return, you will have to file that form 1040A.  Either hire a tax preparer, do it yourself.  The important thing is to make sure you file something.

For more information, you can try the IRS website at www.irs.gov.