Beginning in May, over 130 million individuals will begin receiving payments under the economic stimulus package which was overwhelmingly approved by Congress earlier this year. This plan to help our nation’s economy was a measure of bipartisan cooperation rarely seen in Washington these days, and it comes at a great time for the citizens of our country.
According to the Internal Revenue Service, “the vast majority of Americans who qualify for an economic stimulus payment will not have to do anything other than file their 2007 individual income tax return to receive their payment this year. They will not have to complete applications, file any extra forms or call the Internal Revenue Service to request the payment, which is automatic.”
People must have a valid Social Security Number to be eligible for this payment. Those who file with Individual Taxpayer Identification Numbers, Adoption Taxpayer Identification Numbers or any other ID number will not be eligible for this payment. Additionally, individuals who file 1040 NR, 1040 PR or 1040 SS are not eligible for the payments. These types of returns are usually associated with nonresident aliens, or residents of Puerto Rico, U.S. Virgin Islands, Guam, American Samoa and the Commonwealth of Northern Mariana Islands.
The amount an individual receives under this economic stimulus payment will be determined from 2007 tax returns. The maximum amount an individual can receive is $600 ($1200 for taxpayers who file jointly). The minimum amount an individual will receive is $300 ($600 for taxpayers for file jointly). Additionally, parents will receive an additional $300 for each qualifying child under the age of 17 in their household.
Even if an individual has little or no tax liability, he/she may be eligible for a stimulus payment, as long as that person’s tax return shows $3,000 or more in qualifying income. Congress did institute maximum income limits for the stimulus payments. The payment to individuals with income over $75,000 (or $150,000 for those under Married Filing Jointly status) will be reduced by five percent of the amount of income over those levels.
The IRS has begun sending information to taxpayers regarding the stimulus payments. Most people will receive two notices: 1) a general notice outlining the parameters of the stimulus payment program, and 2) a notice confirming the recipient’s eligibility, stimulus check amount and expected timeframe for payment.
I am hopeful that these payments can assist people who are struggling in our current economy and that they will help stimulate that economy. I do believe the rebate checks issued in President Bush’s first term did give a shot in the arm to our economy, and I think these payments will do the same. If anyone has questions about the stimulus payments, please do not hesitate to contact my office. IBI