Newton County residents have a big incentive to file their tax returns this year - doing so ensures they will receive a stimulus check from the federal government.
Earlier this month the federal government sent out notices to all households who filed tax returns last year. The notices stated that a plan passed by Congress will provide payments of up to $600 for individuals who qualify or $1,200 for married couples filing jointly.
These tax rebates are the centerpiece of a $168 billion economic stimulus package the government hopes will spur the nation out of a recession, caused largely by defaults in the sub-prime mortgage market which were spread throughout the financial sector.
According to Joshalyn Billingsley, general manager for Abundant Returns Tax Service in Covington, in order to receive a stimulus check from the government, residents who are eligible to receive the rebate must file a tax return this year.
Letters are expected to go out later to senior citizens and recipients of veteran's benefits - two groups that often do not file tax returns - informing them of the government's stimulus program. You are eligible to receive a rebate if your income is at least $3,000. The minimum payment for this group will be $300 for an individual and $600 for a couple filing jointly.
Not everyone will be eligible. Singles with incomes of more than $75,000 and couples with more than $150,000 will receive only partial rebates, if any.
Households who earn less than $3,000, immigrants living in the country illegally and anyone who does not file a tax return will not receive a tax rebate. Singles with incomes exceeding $87,000 and couples with incomes exceeding $174,000 also won't qualify, although those caps rise by $6,000 per child.
Billingsley said people whose income comes solely from social security must file a 1040A. If their income comes from a mixture of social security and earned income then a 1040EZ form will be acceptable she said.
Billingsley said singles with an adjusted gross income of more $30,000 can anticipate receiving the full $600. Individuals with an adjusted gross income lower than $30,000 can expect to receive an amount closer to $300. Those with children will get an additional $300 for each qualifying child. Tax rebates will not exceed $1,200.
To estimate your payment the IRS has created an online calculator that after answering a few questions will give you your rebate estimate.
The actual rebate checks are scheduled to go out starting in May, after the IRS has finished separately mailing out routine refunds for the 2007 tax year.
In order to receive your rebate by direct deposit, be sure to sign up for direct deposit when filing your tax return this year otherwise the rebate will be sent by mail. Beginning May 2, rebates will be electronically transmitted to direct deposit accounts. Paper checks will be sent out beginning May 16.
Also new this year said Billingsley is a tax deduction for first-time homeowners who have private mortgage insurance good for approximately 10 percent of the total cost of the insurance.
"Everything else is about the same," Billingsley said of changes to tax filing policy from last year.
Billingsley advised that tax filers be sure to keep all of their receipts saved away with their tax forms so in the event of an audit they are easily accessible. Taxpayers are also advised to make copies of all completed forms and to double check their math and to verify all Social Security numbers before sending in their forms.
Tax returns must be postmarked by April 15. To learn more about the rebate or for advise on filing visit http://www.irs.gov.
The Associated Press contributed to this report.
