The Recovery Rebate Credit is the equivalent of a second-chance stimulus payment, or replacement tax rebate check, for those who did not receive a full tax rebate in 2008.
The recovery rebate is meant to be claimed by people who didn't qualify for the full 2008 tax rebate, but whose circumstances have changed, and they are now eligible for a larger amount.
It is important to note that this rebate is not the same as a 2009 tax rebate that many believe should be part of the 2009 economic stimulus package.
Who Isn’t Getting a Check: Learn Who Doesn’t Qualify for the Recovery Rebate Tax Credit
Individuals who meet all of the following criteria are not eligible for a check and cannot claim this credit on their 2008 tax return:
- They already received a full economic stimulus payment ($600 per individual or $1,200 for married couple and $300 for each qualifying child born in the year 2008 or before). This rule also applies to individuals who would have received the full amount if it had not been offset by outstanding tax debts.
- Their filing status is identical in 2007 and 2008.
- They don’t have any qualifying children.
- Their 2008 tax liability is less than $300 (for individuals) or $600 for married filers.
Missed 2008 Economic Stimulus: How to Claim the Recovery Rebate Tax Credit
The credit can only be claimed on Forms 1040, 1040A, or 1040EZ. To figure out the amount of recovery rebate credit a person is eligible for, he or she will need to know the amount of the 2008 tax rebate. This can be found on Notice 1378, the notice that every recipient of a 2008 tax rebate received last year. Alternatively, individuals may look up the amount on the IRS website using the "How Much Was My 2008 Stimulus Payment?" tool.
Recipients should note that the tax rebate will not come as a separate check; it will be included in the regular income tax refund check.
Tax Rebate Facts: Form 1040 Instructions, IRS Calculator, Special Considerations
- Individuals should use 2008 numbers to calculate this credit (whereas the original 2008 tax rebate was calculated based on 2007 amounts).
- It is possible to file a return just to get this credit, even if an individual is not otherwise required to file a return. In this case, see page 61 of the instructions for Form 1040.
- The IRS offers a Recovery Rebate Credit calculator on its website.
- The IRS will calculate this credit for any taxpayer who requests it. Special instructions for this can be found on page 61 of the instructions for Form 1040.
Anyone who is not sure if they qualify for the Recovery Rebate Credit may wish to consult the IRS website for guidance. In addition, it might be helpful to review the details of the 2008 tax rebate, including who did or did not qualify for a 2008 economic stimulus check.
Resources:
IRS website
Form 1040 Instructions
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