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Your economic stimulus check could be in the mail

It's Your Money

Posted: March 27, 2008 3:24 a.m.
Updated: May 28, 2008 5:03 a.m.
 

In an effort to boost the U.S. economy, Congress passed the Economic Stimulus Package Act of 2008 on Feb. 7.

Starting in May, the Treasury will begin mailing out tax rebate checks to about 130 million households. The process will continue until the summer.

The majority of those who qualify for an economic stimulus payment will not have to do anything other than file their 2007 individual income tax return to receive their payment this year. They will not have to complete applications, file any extra forms or call the Internal Revenue Service to request the payments. The IRS will determine eligibility, figure the amount and issue the payment.

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.

You will find your stimulus payment directly deposited if you have selected that option when you filed your 2007 tax return.

Who is eligible?
The IRS will use the 2007 tax return to determine eligibility and calculate the basic amount of the payment. For most cases, the payment will be equal to the amount of tax liability on the 2007 tax return with a maximum amount of $600 for individuals ($1,200 for taxpayers who file a joint return) and a minimum of $300 for individuals ($600 for taxpayers who file a joint return).

People who don't pay income taxes may qualify for $300 rebates if they had at least $3,000 of earned income or tax liability of at least $1 in 2007. Qualifying income consists of earned income such as wages and net self-employment income as well as Social Security or certain Railroad Retirement benefits and veterans' disability compensation, pension or survivors' benefits received from the Department of Veterans Affairs in 2007. However, Supplemental Security Income does not count as qualifying income for the stimulus payment. Low-income workers must file a 2007 tax return in order to notify the IRS of their qualifying income.

The IRS emphasized that people with no filing requirement who turn file a tax return to qualify for the economic stimulus payment will not get a tax bill. People in this category will not owe money because of the stimulus payment.

Those who qualify for the basic rebates are also eligible for an additional $300 for each dependent child under age 17.

To qualify, a child must be eligible under the Child Tax Credit and have a valid Social Security number.

Eligibility for the stimulus payment is subject to maximum income limits. The payment, including the basic amount and the amount for qualifying children, will be reduced by 5 percent of the amount of income in excess of $75,000 for individuals and $150,000 for those with a Married Filing Jointly filing status.

Anyone who moves after filing their 2007 tax return should notify the IRS by filing Form 8822, Change of Address, and also notify the Post Office.

Julie M. Sturgeon is a Certified Public Accountant in Valencia, specializing in individual and business tax issues. "It's Your Money" appears Thursdays and rotates between a handful of the valley's financial professionals. Her column represents her own views, and not necessarily those of The Signal.


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