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IRS Will Send Stimulus Payments
Automatically Starting in May; Eligible Taxpayers Must File a 2007 Tax
Return to Receive Rebate
WASHINGTON — The
Internal Revenue Service today advised taxpayers that in most cases they
will not have to do anything extra this year to get the economic stimulus
payments beginning in May.
“If you are eligible
for a payment, all you have to do is file a 2007 tax return
and the IRS will do the rest,” said Acting IRS Commissioner Linda
Stiff.
The IRS will use information
on the 2007 tax return filed by the taxpayer to determine eligibility and
calculate the amount of the stimulus payments.
The IRS will begin sending
taxpayers their payments in early May after the current tax season
concludes. Payments to more than 130 million taxpayers will continue over
several weeks during the spring and summer. A payment schedule for
taxpayers will be announced in the near future.
Stimulus payments will be
direct deposited for taxpayers selecting that option when filing their 2007
tax returns. 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.
Most taxpayers just
need to file a 2007 tax return as usual. No other action, extra
form or call is necessary. This Web site will be the best information
source for all updates and taxpayer questions.
In most cases, the payment
will equal the amount of tax liability on the tax return, with a maximum
amount of $600 for individuals ($1,200 for taxpayers who file a joint
return).
The law also allows for
payments for select taxpayers who have no tax liability, such as low-income
workers or those who receive Social Security benefits or veterans’
disability compensation, pension or survivors’ benefits received from
the Department of Veterans Affairs in 2007. These taxpayers will be
eligible to receive a payment of $300 ($600 on a joint return) if they had
at least $3,000 of qualifying income.
Qualifying income includes
Social Security benefits, certain Railroad Retirement benefits, certain
veterans’ benefits and earned income, such as income from wages,
salaries, tips and self-employment. While these people may not be normally
required to file a tax return because they do not meet the filing requirement,
the IRS emphasizes they must file a 2007 return in order to receive a
payment.
Recipients of Social
Security, certain 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. The IRS is working
with the Social Security Administration and Department of Veterans Affairs
to ensure that recipients are aware of this issue.
“Some people
receiving Social Security and veterans’ benefits may not realize they
will need to file a tax return to get the stimulus payment,” Stiff said. “To reach these
people, the IRS and Treasury will work closely with the Department of
Veterans Affairs, the Social Security Administration and key beneficiary
groups on outreach efforts.”
Eligible taxpayers who
qualify for a payment will receive an additional $300 for each child who
qualifies for the child tax credit.
Payments to higher income
taxpayers will be reduced by 5 percent of the amount of adjusted gross
income above $75,000 for individuals and $150,000 for those filing jointly.
Taxpayers must have valid
Social Security Numbers to qualify for the stimulus payment. If married
filing jointly, both taxpayers must have a valid Social Security Number.
And, children must have valid Social Security Numbers to be eligible as
qualifying children.
Taxpayers who file their tax
returns using an Individual Taxpayer Identification Number issued by the IRS
or any number issued by the IRS are ineligible. Also ineligible are
individuals who can be claimed as dependents on someone else’s
return, or taxpayers who file Form 1040-NR, 1040-PR or 1040-SS.
To accommodate taxpayers
who file tax returns later in the year, the IRS will continue sending
payments until December 31, 2008. The IRS also cautions taxpayers that if they file their 2007
tax return and then move their residence that they should file a change of
address card with the U.S. Postal Service.
The IRS will mail two
informational notices to taxpayers advising them of the stimulus payments.
However, taxpayers should be alert for tax rebate scams such as
telephone calls or e-mails claiming to be from the IRS and asking for
sensitive financial information. The IRS will not call or e-mail taxpayers
about these payments nor will it ask for financial information.
Scam e-mails and information about scam calls should be forwarded to phishing@irs.gov.
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