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Do I need to tax my economic stimulus $600 IRS Rebate Check?

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ramki
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Posts: 31


« on: October 24, 2008, 10:26:32 pm »

Most of us received the $600 IRS rebate check from the Economic Stimulus Package.

I mean this one:

The basis of this $600 check is that in order to just-start the economy from entering a recession, every person or couple filing in 2008 for paying taxes in 2007 will each be sent a check for $600 per person or $1,200 per married couple, 4300 for each child living at home. Tax payer must have earned at least $3,000 but less than $75,000 ($150,000 for married couples) in adjusted taxable income to qualify.

Do I need to pay taxes on those $600 that I received from the government?
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« on: October 24, 2008, 10:26:32 pm »

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mod
Moderator
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Posts: 526


« Reply #1 on: October 30, 2008, 01:00:07 am »

Many people are wondering how the economic stimulus rebate will affect tax returns when filing 1040 forms for 2008 and whether they need to tax it.

The rebate that was sent out in May 2008 was a credit to the taxes you will owe on your 2008 income (April 2009 tax return), but it is a new credit, so you don’t have to "pay it back." It will work in a way that in April 2009, when you file your taxes for 2008, the IRS will run the calculation for the stimulus rebate again. If the results show that you would have received more (due to an additional child, for instance), you will be sent the difference (or owe less on your final tax bill). If your results show that you would have received a smaller rebate, then you get to keep the difference.

The economic stimulus is a new tax credit which you got in May 2008 and will be reflected on your 2008 return (i.e., it will show as a credit on your 2008 return, but then will be balanced by the payment that the Government has already made, for a net of $0). The rebate is just an advance payment of a credit to your 2008 taxes.
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danisara
Sr. Member
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Posts: 280


« Reply #2 on: October 30, 2008, 08:10:27 pm »

Great, so I do not even need to report it anywhere on my return?
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TanyVady73
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Posts: 10


« Reply #3 on: November 30, 2009, 09:02:39 am »

Hey,
Ive been in Japan for about 10 months - My contract is for 1 year but my company has told me I can head home now and will be paid the remainder of my contract into my Japaese bank account at the end of each month. Income tax has been deducted from my pay every month but  as Ive been here less than a year, will i need to pay the residents tax before i go??
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steven
Full Member
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Posts: 223


« Reply #4 on: November 30, 2009, 04:32:14 pm »

I am not an expert on Japanese tax law, but in general it works the way that your income is taxed by local government in the country where you work. The same income is also taxed here in the use because you are a citizen and resident of the USA, but you get to deduct the tax you paid abroad from your taxes in the USA. There is one condition though. The country abroad must have a special agreement with the USA that prevents dual taxation. I am sure Japan is one of those countries that have such agreement.
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