Last year’s massive stimulus plan is causing some confusion for taxpayers this year.
The government based it on your 2007 tax return.
But, now that it’s time to crunch the numbers for 2008, you might be able to qualify for more money from what’s being called the Recovery Rebate Credit.
“For example, in 2007, your income was too much, you didn’t qualify for stimulus. In 2008, it changed, unfortunate circumstance it went down. you do qualify and you could get part or all of the stimulus via the recovery rebate credit in 2009 here in the ’08 return,” according to Raphael Tulino, a media relations specialist for the Internal Revenue Service.
Another clear cut example would be if you had a child in 2008.
That would give you an extra $300 on your tax return this year.
There are other situations to qualify for the Recovery Rebate Credit but those two are the most black and white.
The problem the IRS is seeing is a lot of people aren’t filling out the line for the Recovery Rebate Credit correctly or they are overriding their tax program to put in other information.
“Trust the software when it asks you for the information from the stimulus,” Tulino said. “Put the right information in there and you’ll be fine. If you’re using a paper return and you don’t know what that number is, put RRC on that line and let the IRS figure it for you.”
The confusion could delay your refund a week or two.
The IRS estimates about 5% to 10% of taxpayers will get more money from the stimulus through the Recovery Rebate Credit this year.