2009 Stimulus payment

[Questionguy101]

Is the details of the 2009 stimulus payment available already? All I have heard is that they will give a maximum of $400 to a single person and $800 to a married couple. What about those who does not have to pay income tax, are they still eligible to get half of the maximum amount like last year? Is the minimum amount of income that they have to make is still $3,000 in order to qualify for it? Thank you.

[Larmil]

Is the details of the 2009 stimulus payment available already? All I have heard is that they will give a maximum of $400 to a single person and $800 to a married couple. What about those who does not have to pay income tax, are they still eligible to get half of the maximum amount like last year? Is the minimum amount of income that they have to make is still $3,000 in order to qualify for it? Thank you.

In case you haven't been around lately the link you need is http://www.irs.gov/newsroom/article/...html?portlet=6.

[David1980]

Yes. They released new withholding tables on Friday, so those who have W-2 employment will see the lower tax withholding in their pay soon.

http://www.irs.gov/newsroom/article/0,,id=204447,00.html

As far as those who do not have to pay income tax, it is refundable.

This tax credit will be calculated at a rate of 6.2% of earned income and will phase out for taxpayers with adjusted gross income in excess of $75,000, or $150,000 for married couples filing jointly.

So if you made $5,000 earned income you would get 6.2% as your making work pay credit, or $310. Maxes at $400/$800 obviously.

There is also a one-time payment of $250 to certain recipients of income.

http://www.irs.gov/newsroom/article/0,,id=204335,00.html?portlet=6

$250 for Social Security Recipients, Veterans and Railroad Retirees. The Economic Recovery Payment will be paid by the Social Security Administration, Department of Veterans Affairs and the Railroad Retirement Board.

It counts against the making work pay credit and is not being handled by the IRS. Doesn't appear to be a magic number of income to qualify as far as I can tell.

Here you can find the Social Security website's information.

http://www.socialsecurity.gov/payment/

[S T]

2009

I guess my "big" question is how do we account for this stimulus payment on the 2009 tax return.

I have a lot of marginal withholding clients now, so how to deal with that, so they don't "owe" on the 2009 tax return. And this withholding isn't it going to affect our estimated tax payments for clients that typically don't have withholding/or enough withholding?

I really dislike when the government decides to reduce withholding tables, when we as tax professionals have worked so hard at the clients to become almost breakeven on their withholdings or estimate their Estimated tax Payments, or to receive small refunds.

Any suggestions?

Sandy