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Posted by njoracle on April 17, 2008, 9:01 am
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D. Stussy wrote:
>> A self employed person had a bad year in 2007 and had less then $3000
>> income for 2007. Therefore, the person won't be eligible for a stimulus
>> rebate. They expect 2008 income to be substantially higher then $3000.
>> Will they be eligible to get the rebate in 2008 because they weren't
>> eligible in 2007? The IRS FAQ's have a vague reference to this as a
>> possibility but I'm not clear on the details.
>
> The other answers have already told you that to the extent that you don't
> qualify based on your 2007 return, you may qualify based on 2008 and receive
> it )or part of it) then.
>
> However, it's NOT A CARRYOVER.
>
Understood and thanks for your response and the responses from the OPs.
For the record, 2008 income is estimated to be $10,000 to $15,000
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Posted by Phil Marti on April 17, 2008, 9:36 am
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"njoracle" wrote:
> For the record, 2008 income is estimated to be $10,000 to $15,000
As I recall this is self-employment income. At that income level the bulk
of the tax liability, assuming no other income, will be self-employment tax.
It's only income tax that is considered in calculating the credit.
--
Phil Marti
Clarksburg, MD
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by njoracle on April 17, 2008, 3:22 pm
Please log in for more thread options Phil Marti wrote:
> "njoracle" wrote:
>
>> For the record, 2008 income is estimated to be $10,000 to $15,000
>
> As I recall this is self-employment income. At that income level the bulk
> of the tax liability, assuming no other income, will be self-employment tax.
> It's only income tax that is considered in calculating the credit.
>
Yes, it is all self-employment income for a single person using standard
deduction. I plugged some numbers into TaxCut (2007) and came up with
two scenarios:
1. Line 12,22 Income = $13000
Line 43 Taxable Income = 3331
Line 76 Tax due = 2131
2. Line 12,22 Income = $12000
Line 43 Taxable Income = 2402
Line 76 Tax Due = 1829
Can I assume that under 1. there would be a credit but under 2. there
would be no credit or will it some how graduated?
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Phil Marti on April 17, 2008, 5:21 pm
Please log in for more thread options "njoracle" wrote:
>> It's only income tax that is considered in calculating the credit.
> Yes, it is all self-employment income for a single person using standard
> deduction. I plugged some numbers into TaxCut (2007) and came up with two
> scenarios:
>
> 1. Line 12,22 Income = $13000
> Line 43 Taxable Income = 3331
> Line 76 Tax due = 2131
>
>
> 2. Line 12,22 Income = $12000
> Line 43 Taxable Income = 2402
> Line 76 Tax Due = 1829
>
> Can I assume that under 1. there would be a credit but under 2. there
> would be no credit or will it some how graduated?
No. You left out the important number: Income tax after credits (line 57).
If there is at least $3,000 of qualifying income (there is here) the credit
is income tax after credits (no children here) with a minimum of $300 and a
maximum of $600 (no joint return here). With this set of facts the credit
will be line 57 in case 1 and $300 in case 2. In case 2 he'll get a little
help paying the self-employment tax (line 58); in case 1 he'll owe the
complete amount of SE tax.
--
Phil Marti
Clarksburg, MD
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Elle on April 17, 2008, 3:22 pm
Please log in for more thread options > "njoracle" wrote:
>> For the record, 2008 income is estimated to be $10,000 to
>> $15,000
>
> As I recall this is self-employment income. At that
> income level the bulk of the tax liability, assuming no
> other income, will be self-employment tax. It's only
> income tax that is considered in calculating the credit.
Self-employment income is qualifying income for the rebate.
I see the IRS calculator taking this into account using
self-employment tax with the link at
http://www.irs.gov/newsroom/article/0,,id=177937,00.html#Calculator.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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