Showing posts with label too many errors. Show all posts
Showing posts with label too many errors. Show all posts

Monday, February 9, 2009

STOP - LOOK - LISTEN UP FRIENDS *

Many tax returns are coming to the IRS in error. The IRS is sending public notices asking tax payers to take just a minute to familiarize yourself with the Recovery Rebate & the Stimulus Package.

There is a lot of information and much of it false telling people they are supposed to be getting these big checks for $12,000.00. They are mis-representing, don't fall for the Scam! I have included the announcement. If you need any help understanding, just leave a post or get with me, but if you have a question, probably 23 other people do too...

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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 information do I need to figure the credit?
A. You need to know the amount of your 2008 economic stimulus payment to complete the recovery rebate worksheet. The IRS sent recipients Notice 1378, Economic Stimulus Payment Notice, which reported this amount and any reductions that were made to pay other debts. If you don’t have your notice, you can use the online tool How Much Was My 2008 Stimulus Payment? to find the amount.
Q. My filing status in 2007 was different than it is for 2008. Does this impact the amount of the credit I can claim?
A. Maybe. That's because married taxpayers who file jointly are each assumed to have received half of the economic stimulus payment. So, if your filing status for 2008 changed to or from Married Filing Jointly or if you remarried in 2008, follow these directions to determine the amount you need to use when determining the recovery rebate credit.
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.
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. The combined amount you received in the form of an economic stimulus payment plus any additional amount you receive, if any, in the form of a recovery rebate credit is independent of the normal tax you would have paid.
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.
Related items:
Recovery Rebate Credit Information Center
Economic Stimulus Payment Information Center
1040 Central




Page Last Reviewed or Updated: January 16, 2009
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