What is the 2007 tax rebate?

    Published: 06-16-2009
    Views: 9,370
    Goodman & Company Tax Director Art Auerbach explains about the 2007 tax rebate and what you should know when filing your tax return.

    Host: What is the 2007 Tax Rebate?

    Arthur Auerbach: If you are preparing your 2007, this is part of the Economic Stimulus Package. You are entitled to - it's called a rebate but it really isn't. What it is is an advance payment of a credit on your 2008 tax return. It's going to be based on your 2007 filing. If you are single and your adjusted gross income is under 75000 on a joint return, if it is under a 150,000, you will be entitled to an Economic Stimulus Payment that the IRS is going to begin sending out in May of 2008. If you filed your tax return before that.

    The couple of things to remember here. The rebate checks cannot be issued by IRS after December 31st. So the longer you hang around and wait to file your 2007 return, its just going to delay getting any particular Stimulus rebate payment. Now, if you don't file or you don't qualify in 2007, so you file your '07 return, you determine you are not entitled based on your '07 return to get a rebate check, doesn't mean you are out of the game. Because, remember what I said. It's an advanced payment against '08 based on '07. So, I still might be entitled to a credit on my '08 return. So if my '07 income is high and my '08 income is low, I still might get a credit equivalent to the rebate check against my '08 tax return. So, the reason that this has come up as a separate question is don't be dismayed, if based on your '07 filing you may not qualify. You may still qualify based on your '08 filing for the credit not necessarily getting a check from the government. This is also important as the filing status. Because if I file jointly and the joint return income is over a $150,000, then I am out of the rebate game. But if I file separately with my spouse and let's say her income was $75,000, my income was 60 or 50 or 80,000, I might try to combine or see whether filing separately will qualify us for rebate checks, because I might not get it putting the income together but I may get it by filing two separate returns.