News from the IRS

by Gregg Semanick

The Internal Revenue Service advised taxpayers that in most cases they will not have to do anything extra this year to get the economic stimulus payments beginning in May.
The IRS will use information on the 2007 tax return filed by the taxpayer to determine eligibility and calculate the amount of the stimulus payments.
The IRS will begin sending taxpayers their payments in early May after the current tax season concludes. Payments to more than 130 million taxpayers will continue over several weeks during the spring and summer.
Stimulus payments will be direct deposited for taxpayers selecting that option when filing their 2007 tax returns. Taxpayers who have already filed with direct deposit won’t need to do anything else to receive the stimulus payment.
Most taxpayers just need to file a 2007 tax return as usual. No other action, extra form or call is necessary.
In most cases, the payment will equal the amount of tax liability on the tax return, with a maximum amount of $600 for individuals ($1,200 for taxpayers who file a joint return).
The law also allows for payments for select taxpayers who have no tax liability, such as low-income workers or those who receive Social Security benefits or veterans’ disability compensation, pension or survivors’ benefits received from the Department of Veterans Affairs in 2007. These taxpayers will be eligible to receive a payment of $300 ($600 on a joint return) if they had at least $3,000 of qualifying income. 
Recipients of Social Security, certain Railroad Retirement and certain veterans’ benefits should report their 2007 benefits on Line 14a of Form 1040A or Line 20a of Form 1040.
According to Stiff, the IRS and Treasury will work closely with the Department of Veterans Affairs, the Social Security Administration and key beneficiary groups to reach these people.
Eligible taxpayers who qualify for a payment will receive an additional $300 for each child who qualifies for the child tax credit. 
 Payments to higher income taxpayers will be reduced by 5 percent of the amount of adjusted gross income above $75,000 for individuals and $150,000 for those filing jointly.
Taxpayers who file their tax returns using an Individual Taxpayer Identification Number issued by the IRS or any number issued by the IRS are ineligible. Also ineligible are individuals who can be claimed as dependents on someone else’s return, or taxpayers who file Form 1040-NR, 1040-PR or 1040-SS.
To accommodate taxpayers who file tax returns later in the year, the IRS will continue sending payments until December 31. The IRS also cautions taxpayers that if they file their 2007 tax return and then move their residence that they should file a change of address card with the U.S. Postal Service.
The IRS will mail two informational notices to taxpayers advising them of the stimulus payments, though they will not call or email taxpayers about these payments or ask for financial information. Information on scam e-mails and phone calls should be forwarded to phishing@irs.gov.

Gregg Semanick is a spokesperson for the IRS.