Act Now to Get Your Tax Rebate
If you still haven't received your stimulus check, here's what you need to do.
Aug. 26, 2008 — -- Millions of American taxpayers have seven weeks to act if they want to be sure to receive tax rebate checks before the end of the year.
The vast majority of those eligible for rebates of $300 or more, pocketed their economic stimulus payments from the IRS months ago, but millions more have yet to claim theirs.
If you're one of them, now is the time to act. To collect your tax rebate by the end of the year, you must file a 2007 federal tax return by Oct. 15. Even if you owe nothing to the IRS, a tax return must be filed to confirm eligibility for the rebate program that was designed to give a boost to the lagging U.S. economy.
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Taxpayers may also claim their rebate next year when they file their 2008 tax returns. But why wait?
The two main categories of people who have yet to receive their economic stimulus payments are retirees and veterans who normally do not file tax returns. These folks typically owe no tax on the Social Security, veterans or railroad benefits they receive.
Others yet to claim their payments are those who requested extensions on their filing deadlines.
The IRS has been reaching out to eligible retirees and veterans with a summer campaign that included a mailing to 5.2 million people believed to qualify for a payment. The mailing, which went out in late July and early August, included a blank tax form along with a sample form showing how to file for the stimulus payment.
As approved by Congress, the economic stimulus program provided for payments of $300 to $600 for working adults ($600 to $1,200 for married couples) and an additional $300 per child based on their 2007 income. The payments phase out at higher income levels.
The Economic Stimulus Act also created a special category for people who receive certain types of income, but do not normally file a tax return, either because their income is too low or their income is nontaxable. Those with nontaxable income include many recipients of Social Security, veterans and railroad retirement benefits.
People in this special category must have at least $3,000 in qualifying income to be eligible for the minimum payment of $300 ($600 for married couples). Qualifying income is the total of Social Security, veterans affairs and railroad retirement benefits, plus earned income from a job, including nontaxable combat pay.
Recipients of just Supplemental Security Income are not eligible.
As of early July, the IRS had issued 112 million payments totaling nearly $92 billion. In total, the tax collection agency expects to distribute 124 million payments by the end of this year.
If you're one of those yet to file for a rebate, or you know someone like this, you can visit one of 400 local Taxpayer Assistance Centers where taxpayers can receive help filing for a rebate. Taxpayers also may be able to find help at a local Tax Counseling for the Elderly site, Low Income Taxpayer Clinic, or Volunteer Income Tax Assistance center.
The sooner you act, the sooner the money will arrive.
This work is the opinion of the columnist, and in no way reflects the opinion of ABC News.
David McPherson is founder and principal of Four Ponds Financial Planning (www.fourpondsfinancial.com) in Falmouth, Mass. He previously worked as a financial writer and editor for The Providence Journal in Rhode Island. He is a member of the Garrett Planning Network, whose members provide financial advice to clients on an hourly, as-needed basis. Contact McPherson at david@fourpondsfinancial.com.