By now everyone has heard about the stimulus rebate that “some” taxpayers may be receiving in late spring. We found it hard to find information on who would actually receive it and how much would it be. Reading article after article they were only stating general information such as, if your tax liability was large enough and your income was within certain limits you will receive $300 – $1200. We did read an article today that the IRS was going to send out two letters this month explaining the rebate. Going directly to the IRS site, they have a very informative section explaining everything to do with the rebate.

We found it so frustrating that the main stream media wasn’t much help we thought we would write this post about the expected rebate.

Who will get the rebate?

• Anyone who files federal taxes by April 15, 2007 and has an earned income over $3000 and under $75,000 (individual) or $150,000 (couple).
• Low income citizens receiving Social Security or certain Veteran benefits need to file a 1040A to be eligible. Click here for more information.

Who will not get the rebate?

• You don’t file a 2007 tax return.
• Your net income tax liability is zero and your qualifying income is less than $3,000. To determine your qualifying income, add together your wages, net self-employment income, nontaxable combat pay, Social Security benefits, certain Railroad Retirement benefits and certain veterans’ payments.
• You can be claimed as a dependent on someone else’s return. For example, this would include a child or student who can be claimed on a parent’s return.
• You do not have a valid Social Security Number.
• You are a nonresident alien.
• You file Form 1040NR or Form 1040NR-EZ, Form 1040PR or Form 1040SS for 2007.

Estimate your rebate:

Check your Adjusted Gross Income Line 38 on 1040, Line 22 on 1040A

If your single and your AGI is less than $75,000 continue, if not click here

If you filed joint and your AGI is under $150,000 continue, if not click here

Find your tax liability Line 57 on 1040, line 37 1040A

* special note to parents the IRS is using the tax liability BEFORE the child tax credit is used to offset your liability, so use line 46 on 1040, line 28 1040A if you received child tax credit.

Your rebate will be the amount of your tax liability up to $600 if single and up to $1200 for couples plus $300 per qualifying child.

* a qualifying child would be one you could claim on the child tax credit (under 17)

Quick Examples:

• Married couple with two children, AGI is $35,000, federal income tax liability before child tax credit is $1,070.
  Rebate is $1,070
  Qualifying child credit is $600
  TOTAL is $1,670
• Single parent with two children, AGI is $22,000, federal income tax liability before child tax credit is $395.
  Individual rebate is $395
  Qualifying child credit is $600
  TOTAL is $995

How will you receive your rebate?

• If your federal tax return was direct deposited, your rebate will be direct deposited in the same account. (The Government finally has a brain)
• If your account was closed, you did not provide one, you owed a tax liability your check will be mailed. Although BIG HINT they say if you owe taxes this year fill out the direct deposit information on your return and your rebate will be in your bank account.
• If you owe a past tax liability your rebate will be applied to that. (They always get their money)
• If you received a RAL (Rapid Refund loan) from company like H&R block your check will also be mailed. (The IRS has the financial institutions bank information not yours)

The Rebate will not be taxable income next year. Beware of scams out there requesting any information in order to receive this rebate. Remember all you have to do to be eligible is to file your 2007 Federal Taxes!

For more detailed information please visit http://www.irs.gov

Update:

IRS Economic Stimulys Payment Calculator 

Stimulus Payment Schedule for Tax Returns
Received and Processed by April 15