Many people received the 2008 stimulus checks. The IRS estimated that approximately 124 million families would receive the checks ranging from $300-$1200 depending on the individual or families eligibility. The IRS also stated that the stimulus payments were not taxable, wouldn’t reduce 2007 or 2008 tax refunds nor would it increase the amount a tax payer owed on their 2008 taxes.
So, why is it that as tax season begins for 2008 tax payers are fuming over the deduction of the stimulus payment from their 2008 tax return?
After personally hearing at least three people express their discontent with having to repay the stimulus payments I decided to check out why no one, or at least none of these people, had any idea that the stimulus money had to be repaid. Upon receiving the stimulus checks they were not under the impression that what they were receiving was basically a loan.
I went to the IRS website and on the site the stimulus money is defined as an advance payment. Now when I think of the word advance I immediately think of repayment, but according to the IRS.gov site the stimulus payments would not affect 2008 tax returns. Well a deduction of the exact amount of your stimulus payment from your 2008 tax return says otherwise.
After a little more blog browsing I came across others who state that they too had a deduction on their 2008 tax return that is the same amount of the stimulus check they received.
After searching the IRS.gov site, and quite a few others, I still don’t have a definite answer as to whether or not recipients of the stimulus checks must pay the money back, however I will say that from those who have complaints, they are outraged that they were not told on the front end that what they were receiving had to be repaid. Some are saying that when having their taxes done at H&R Block the tax preparer asks how much you received from the stimulus package with no explanation of why the question is being asked. One tax payer stated that when she was asked by the tax preparer she asked why that information was needed and she was then told that the money she received would be deducted from this year’s return. She also babbled off some other information about credits, tax liability and excess, none of which the tax payer understood.
I am currently reading The Description of the “Economic Stimulus Act of 2008”
Hopefully within the pages of this document I will find the answer to the burning questions regarding repayment of the 2008 stimulus checks.
If anyone has any information please feel free to share.
…more information forthcoming