2008 TAX QUESTIONS

[popeye]

I have 2 questions about 2008 tax filing:

1: Will the $600 "incentive" sent to me last year be deducted from any tax refund I might receive in 2009 on 2008 taxes?

2: If I wind up owing the IRS (I usually do) will the $600 be added to the deficit? EXP: If I owe $400, will the additional $600 be tacked on for a total of $1000 owed?

Thanks for any info, Jim

 

[spasmo]

IIRC, that money is not suppose to be taxable. Regardless, you wouldn't owe them $1000 you would owe a percentage (whatever your tax bracket is)

 

[Doublet]

Is not suppose to be taxable .

 

[popeye]

I understand that it's not taxable. I haven't looked at 2008 form yet. A woman at work did her taxes yesterday and mentioned between she and her husband they would have received $2000 back. Last line on form said deduct any tax incentive received in 2008. In their case $1200. So now they get $800 back instead of $2000.

 

[jeremy]

I think if you can track down the original verbiage... Wasn't this referred to originally as a credit and not an incentive...

 

[spasmo]

Here is the wording from the IRS website:

Any economical stimulus payment is not taxable but reduces your recovery rebate credit.

Recovery Rebate Credit: If you did not receive the full economical stimulus payment you may be able to claim the recovery rebate credit.

Here is what is new for 2008 taxes
http://www.irs.gov/pub/irs-pdf/p17.pdf