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Posted by John D. Goulden on April 4, 2008, 5:43 pm
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An individual has earned income, but not enough to be eligible for a
stimulus payment (or even be required to file). The individual does have
dependents. A 2007 return was filed so that that individual could get
witholding back (not much) and some EIC (a bit under a thousand).
Will this indivudual get $300 each for the two dependent children even
though the indivudual doesn't qualify for a stimulus payment?
--
John D. Goulden
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Posted by Phil Marti on April 4, 2008, 8:22 pm
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"John D. Goulden" wrote:
> An individual has earned income, but not enough to be eligible for a
> stimulus payment (or even be required to file). The individual does have
> dependents. A 2007 return was filed so that that individual could get
> witholding back (not much) and some EIC (a bit under a thousand).
>
> Will this indivudual get $300 each for the two dependent children even
> though the indivudual doesn't qualify for a stimulus payment?
No. The additional payment per qualifying child applies only if the
taxpayer qualifies for a payment in the first place.
--
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 removeps-groups@yahoo.com on April 4, 2008, 9:04 pm
Please log in for more thread options > "John D. Goulden" wrote:
> > Will this indivudual get $300 each for the two dependent children even
> > though the indivudual doesn't qualify for a stimulus payment?
>
> No. The additional payment per qualifying child applies only if the
> taxpayer qualifies for a payment in the first place.
If one does not qualify for the stimulus check based on their 2007
return figures, can they still qualify for the stimulus check in
2008? My understanding is that they can, and the stimulus check will
appear as a credit on their 2008 return which will be filed usually by
April 15 2009, and the credit will be non-refundable (meaning it can
reduce your tax to zero, but you won't get money back).
If this is the case, then a good strategy will be to find work in 2008
so that the 2008 earned income is at least 3k, and the total income is
larger than the standard deduction + exemption + ($600/10%).
Explanation by example: A single filer would only pay tax on income
above $8750, and the tax rate is 10%. 10% of $6000 is $600. So if
they earned 8750+6000=14750, then they would owe $600 tax, but then
they would get the economic stimulus rebate and their tax would be
$0. However, other non-refundable credits such as the credit for the
elderly or disabled would reduce the stimulus check credit, in which
case the strategy should be to increase income even further.
In addition, the filer might qualify for the earned income tax credit
as well, which thankfully is refundable (you get money back).
For reference, the law is at
http://www.govtrack.us/congress/billtext.xpd?bill=h110-5140
--
<< ------------------------------------------------------- >>
<< 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 4, 2008, 10:49 pm
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> If one does not qualify for the stimulus check based on their 2007
> return figures, can they still qualify for the stimulus check in
> 2008?
Yes.
> My understanding is that they can, and the stimulus check will
> appear as a credit on their 2008 return which will be filed usually by
> April 15 2009, and the credit will be non-refundable (meaning it can
> reduce your tax to zero, but you won't get money back).
Incorrect. The 2008 credit is refundable, just like EITC.
--
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 removeps-groups@yahoo.com on April 6, 2008, 3:42 pm
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> Incorrect. The 2008 credit is refundable, just like EITC.
But the law says
<Quote>
`(a) In General- In the case of an eligible individual, there shall be
allowed as a credit against the tax imposed by subtitle A for the
first taxable year beginning in 2008 an amount equal to the lesser
of--
`(1) net income tax liability, or
`(2) $600 ($1,200 in the case of a joint return).
</Quote>
Since they use the word "lesser", that seems the credit is non-
refundable.
--
<< ------------------------------------------------------- >>
<< 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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