Here’s good news: Your tax rebate is in the mail – or will be, come May. Here’s even better news: All you have to do is file your tax return, and you’ll receive $600 per filer plus $300 for each child under 17. For a joint return claiming two children, you’ll get a rebate of $1,800. That’s $600 for you, $600 for your spouse, and $300 for each of your children.
That all there is to it, if your income is below the cap of $75,000 ($150,000 on a joint return). For every dollar you earn over that, you’ll lose a nickel. So if your joint income is $170,000, you’ll forfeit $1,000 of your rebate. If your income is really high, forget it – you aren’t included in the tax bonanza giveaway.
But what if your income is so low that you don’t have to file a tax return or pay taxes? Lots of seniors living on social security fall into this category. This year, it will pay you to file a partial form anyway, as long as you have income of $3,000 or more. Just put your name, address and social security number on the tax form, indicate your income in the appropriate boxes, write “Stimulus Payment” at the top of the form, and sign it. The rest of the form doesn’t need to be completed.
Now, here’s where it gets tricky. Even though the rebate is going to be mailed to those who filed a 2007 income tax return, it’s really an advance rebate on your 2008 taxes. So if your income for 2007 is high, you’ll get no rebate this year, but you still may be eligible for a rebate when you file your 2008 return, if your income is lower. The same math applies to those with low income. If your 2007 income is under $3,000 you won’t get a rebate now, but if your income increases in 2008 you can claim the rebate when you file next year.
But what if your 2008 return shows that you are eligible for a lower rebate than you already received, do you have to pay it back? No, says the Treasury – you get to keep the full amount.
Don’t go shopping just yet. Although the government will begin sending out checks in early May, the massive mailing won’t be completed until July. And if you don’t get around to filing your taxes until October, your check won’t arrive until just in time for holiday shopping.
You’ll find many other helpful tax tips in the booklet 150 Ways to Save Taxes Through Life’s Transitions.