Economic Stimulus Act of 2008

[veritas]

What the heck is a

sticky thread? And how do you do that?

[Possi]

Just in...

Got this in my email today.
According to this, people on SS retirement who are not required to file will need to file in order to receive a check.
I took it as a marketing opportunity for that pocket of people.
From NATP:

President Signs Stimulus Package

On February 13, President Bush signed the long awaited stimulus package designed to put money into the pockets of many American taxpayers. Along with the rebate checks, the bill contains some business incentives.

The IRS has indicated that they will begin mailing the rebate checks in late spring and continue through the summer. The rebates are based on the information reported on the taxpayer’s 2007 return. If a return is not filed, the taxpayer will not receive a check even if they may otherwise qualify. Many of the taxpayers who fall into this category are not required to file because of low income. If a return is filed for these taxpayers, the IRS will send them a rebate check provided their qualified income is at least $3,000.

Recipients of Social Security, Railroad Retirement, and certain veterans’ benefits should report their 2007 benefits on Line 14a of Form 1040A or Line 20a of Form 1040. Taxpayers who already have filed but failed to report these benefits can file an amended return by using Form 1040X to ensure they receive their rebate.

For taxpayers who elect direct deposit for their 2007 income tax refund, their rebate check will also be deposited directly into that same bank account.

Most taxpayers will receive two notices from the IRS. The first general notice from the IRS will explain the stimulus payment program. The second notice will confirm the recipients’ eligibility, the payment amount, and the approximate timetable for the payment. Taxpayers will need to save this notice to assist them when they prepare their 2008 tax return next year.

The full text of NATP’s summary of the stimulus package and a Treasury Department release, with examples computing the amount of the rebate, is available on NATP's website.

[Possi]

Just in...

I received this information today. Waited to ask questions until something firm was here. This came from NATP...

President Signs Stimulus Package

On February 13, President Bush signed the long awaited stimulus package designed to put money into the pockets of many American taxpayers. Along with the rebate checks, the bill contains some business incentives.

The IRS has indicated that they will begin mailing the rebate checks in late spring and continue through the summer. The rebates are based on the information reported on the taxpayer’s 2007 return. If a return is not filed, the taxpayer will not receive a check even if they may otherwise qualify. Many of the taxpayers who fall into this category are not required to file because of low income. If a return is filed for these taxpayers, the IRS will send them a rebate check provided their qualified income is at least $3,000.

Recipients of Social Security, Railroad Retirement, and certain veterans’ benefits should report their 2007 benefits on Line 14a of Form 1040A or Line 20a of Form 1040. Taxpayers who already have filed but failed to report these benefits can file an amended return by using Form 1040X to ensure they receive their rebate.

For taxpayers who elect direct deposit for their 2007 income tax refund, their rebate check will also be deposited directly into that same bank account.

Most taxpayers will receive two notices from the IRS. The first general notice from the IRS will explain the stimulus payment program. The second notice will confirm the recipients’ eligibility, the payment amount, and the approximate timetable for the payment. Taxpayers will need to save this notice to assist them when they prepare their 2008 tax return next year.

The full text of NATP’s summary of the stimulus package and a Treasury Department release, with examples computing the amount of the rebate, is available on NATP's website.

[Zee]

I have read varying things in different places - so I have a question that maybe someone here can answer. If my husband and I filed jointly, made under the $150k, but still owed $13 to the federal govt - will we be receiving this rebate?

Yes, most likely you'll qualify for the full $1200 rebate. It isn't the amount you "owe" that affects the rebate. It's the amount of income taxes you paid (including additional AMT), less nonrefundable credits (excluding the child tax credit. You'll receive the lesser of the rebate or taxes paid, but not less than $300 each, or $600.

[mblatour]

Due to the fact that......

you have federal income tax liability, you would indeed receive the rebate. If you are Married Filing Joint and are under the $150K amount, you should receive $1200.

[betseyjane]

I have read varying things in different places - so I have a question that maybe someone here can answer. If my husband and I filed jointly, made under the $150k, but still owed $13 to the federal govt - will we be receiving this rebate?

[Black Bart]

Good question, Snag.

Is the term "social security recipients" extended to include people not of old age, but receiving disability payments from the social security administration?

I had one of these come in yesterday -- took a guess and told him yes (hope I don't have to eat my words).

One other thing -- does "qualifying income" refer only to earned income plus SS, VA, and RR benefits? Nothing for, say, a Schedule E landlord who's not on SS yet?

[Snaggletooth]

Disability Payments

Is the term "social security recipients" extended to include people not of old age, but receiving disability payments from the social security administration?

[Gene V]

More information

This was e-mailed

There Economic Stimulus Plan will have minimal impact on 2008 calendar year income tax returns.



Taxpayers will reconcile the amount of the credit with the payment they receive in the following manner. They will complete a worksheet calculating the amount of the credit based on their 2008 income tax return. They will then subtract from the credit the amount of the payment they received in 2008. For many taxpayers, these two amounts will be the same. If, however, the result is a positive number (because, for example, the taxpayer paid no tax in 2007 but is paying tax in 2008), the taxpayer may claim that amount as a refundable credit against 2008 tax liability. If, however, the result is negative (because, for example, the taxpayer paid tax in 2007 but owes no tax for 2008), the taxpayer is not required to repay that amount to the Treasury. Otherwise, the checks have no effect on tax returns filed for 2008; the amount is not includible in gross income and it does not otherwise reduce the amount of withholding.



Thank you,



Brian Wozniak

IRS SB/SE CLD


Brian.Wozniak@irs.gov

[Kong]

To Bee Knees

I am going to charge a maximun of $30.00 to one time clients in order for them to recieve whatever the goverment is willing to send them. I understand that we need to charge for our services but we more then make that up with our regular paying clients. We as individuals need to give back to the community which we serve. So what if I don't see them again, at least I gave alittle back.

[BOB W]

John > I like the idea of having the VITA phone number handy. The more I think about this situation the more I don't want it. It will make me the bad guy no matter what I do. Charging client's parents $75-$90 or more> I'm a thief....what bad goodwill that will be .............

[JohnH]

Exactly the point

I know that not every new client I set up will return. However, if I know beforehand that the preparation is probably a one-time event then I factor that into what I charge - I generally increase the fee. Bob, you nailed it - there's little payback in setting up a one-time client at normal fees.

Add to that the fact that every time most of these clients hears about a friend of theirs getting their check, they will be calling to ask why they haven't received their check yet (I'm guessing there will be some sort of staging of when the checks are issued, probably by last name. But even if we tell them the schedule they won't remember it).

Many of them will also call just to let you know they got the check, or to ask why their check is less than the one their neighbor got. And I predict there will be some who fall through the cracks for one reason or another, will require some sort of follow-up, and won't want to pay for the extra work because they've "already paid you".

Dont' mean to be a pessimist, but I think it's less-than-desirable business. I don't intend to file them for free, but I will encourage anyone who calls to check into VITA or TCE & get it done for free. I also plan to have the phone numbers handy.

[BOB W]

One of the reasons why we charge a new client the same as an old client is because we anticipate that we will not have to setup the client ever again. In the case of a one time client, setup has a value. What is it worth to you?

[Bees Knees]

Charge your regular fee!

OK, I’m not going to feel guilty charging people my minimum fee for filing a return with just Social Security benefits or VA benefits reported on line 20a and zero on line 20b, just so that they can get their rebate. I did that last year for people who wanted their telephone tax rebate.

If we don’t file a 2007 return for them to get their rebate check this summer, we will still have to file one in 2008 so that they can get their refundable credit. What’s the difference? They still have to PAY us for at least one year’s worth of tax preparation to get the money.

Don’t be cheap on your fees. This is not our fault, so stop thinking you have to perform some kind of community service at next to nothing rates.

[clr]

Stimulus Payments: Instructions for Low-Income Workers and Recipients of Social Secur

http://www.irs.gov/irs/article/0,,id=179096,00.html