| How Much Rebate will taxpayers get in 2008?
The IRS has stated that "the eligibility for and amount of stimulus payments to taxpayers will vary according to their income and family situations."
The payments will range from $300 to $600 for individuals and $600 to $1200 for joint filers. Taxpayers may receive $300 for each qualifying child. But, payments could be less, depending on tax liability and Adjusted Gross Income.
Unfortunately for some, a phaseout reduction begins at $75,000 for single filers and $150,000 for joint filers.There are 4 possible scenarios:
1. Married with Children
Here are some examples provided by the IRS of how the Economic Stimulus Act of 2008 may affect taxpayers who are married, file a joint return and have children who qualify for the child tax credit payment:
a) Married couple with two children, no wages, veterans’ payments of $2,000, social security benefits of $2,000, no federal income tax liability before child tax credit.
Individual rebate is $600
Qualifying child credit is $600
TOTAL is $1,200
b) Married couple with two children, no wages, no social security benefits, no veterans’ payments, AGI is $25,000, federal income tax liability before child tax credit is $70.
Individual rebate is $600
Qualifying child credit is $600
TOTAL is $1,200
c) Married couple with two children, AGI is $35,000, federal income tax liability before child tax credit is $1,070.
Individual rebate is $1,070
Qualifying child credit is $600
TOTAL is $1,670
d) Married couple with two children, AGI is $160,000, federal income tax liability before child tax credit exceeds $1,200.
Individual rebate is $1,200
Qualifying child credit is $600
Phaseout reduction is ($500)
TOTAL is $1,300
2. Married without Qualifying Children
Here are some examples provided by the IRS of ways the Economic Stimulus Act of 2008 may affect taxpayers who are married, file a joint return and are either childless or do not have children who qualify for child tax credit payment:
a) Married couple with no children, no wages, veterans’ payments of $2,000, social security benefits of $2,000, no federal income tax liability.
Individual rebate is $600
b) Married couple with no children, no wages, no social security benefits, no veterans’ payments, AGI is $20,000, federal income tax liability is $250.
Individual rebate is $600
c) Married couple with no children, AGI is $25,000, federal income tax liability is $750.
Individual rebate is $750
d) Married couple with no children, AGI is $60,000, federal income tax liability exceeds $1,200.
Individual rebate is $1,200
3. Single (Head of Household) with Children
Here are some examples provided by the IRS of how the Economic Stimulus Act of 2008 may effect taxpayers who are single, file as head of household and have children who qualify for the child tax credit payment:
a) Single parent with two children, no wages, no social security benefits, no veterans’ payments, AGI is $20,000, federal income tax liability before child tax credit is $195.
Individual rebate is $300
Qualifying child credit is $600
TOTAL is $900
b) Single parent with two children, AGI is $22,000, federal income tax liability before child tax credit is $395.
Individual rebate is $395
Qualifying child credit is $600
TOTAL is $995
c) Single parent with two children, AGI is $60,000, federal income tax liability before child tax credit exceeds $600.
Individual rebate is $600
Qualifying child credit is $600
TOTAL is $1,200
d) Single parent with two children, AGI is $90,000, federal income tax liability before child tax credit exceeds $600.
Individual rebate is $600
Qualifying child credit is $600
Phaseout reduction is ($750)
TOTAL is $450
4. Single without Qualifying Children
Here are some examples provided by the IRS of how the Economic Stimulus Act of 2008 may affect taxpayers who are single and either childless or do not have children who qualify for the child tax credit:
a) Individual with no wages, no social security benefits, AGI is $10,000, federal income tax liability is $125.
Individual rebate is $300
b) Individual with AGI is $12,000, federal income tax liability is $325.
Individual rebate is $325
c) Individual with AGI is $35,000, federal income tax liability in excess of $600.
Individual rebate is $600
d) Individual with AGI is $80,000, federal income tax liability in excess of $600.
Individual rebate is $600
Phase out reduction is ($250)
TOTAL is $350
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