It’s Fix the Tax Code Friday!
As the economy continues to sour, Congress and the White House both agree that some measure of economic stimulus is needed. The problem? They can’t agree on what would work best.
So, I’m taking it to you, the taxpayers…
Which of the following scenarios currently being contemplated by Congress would most help the US out of its current economic mess?
1, Temporarily suspending capital gains on sales of securities
2, A second round of tax rebate checks
3, Extending jobless benefits
4, Expanding capital gains exemptions for homeowners to include multiple residences
5, Additional funds for food stamps
6, Allowing offshore drilling
7, Cutting taxes for US corporations with foreign subsidiaries
Or do you vote “none of the above”?
Sound off!
Taxpayer asks:
We claimed our son last year on our taxes. Born April 1989. We have a daughter who is 16. We recieved $1500 stimulus check. None for our son and he didn’t get one for himself either. Should he have? Thank you.
Taxgirl says:
Sorry, no. Eligible taxpayers received an additional $300 for each qualifying child. However, to qualify a child must be under age 17 as of December 31, 2007. So, if you claimed your (then) 18 year old son on your return, he would not have qualified to receive a check on his own as your dependent – and you would have not received a payment for him because of his age.
I know, I know. I’ve heard a bunch of complaints about this one…
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
Have a question? Ask the taxgirl!
In a move that should surprise very few, House Speaker Nancy Pelosi confirmed yesterday that Congress is “unlikely” to approve an economic stimulus package that included tax rebate checks during this calendar year.
The Democrats are, however, still pressing for approval on their $61 billion “economic stimulus package” which includes relief for the jobless and expanding Medicaid provisions; that package as currently proposed does not include any tax rebates. However, Pelosi rejected the notion that she would pad the bill with tax cuts or other measures to attract GOP votes. Right, cause Congress would never tack things onto a bill just to make it pass.
Taxpayer asks:
I was told by “somebody” that the stimulus checks we received will be deducted from our tax refunds for 2008? Is that true?
Taxgirl says:
Nope. The tax rebates are not taxable and will not be credited against your 2008 return – unlike the 2001 rebates which were credited against the 2002 returns. There was some initial confusion about this – even CNN reported it differently, but that has since been cleared up.
I haven’t seen the 2008 returns yet but my understanding is that you will report the amount received on your individual tax return. This is ostensibly to make sure that everyone got their fair share (insert throat clearing here). The IRS says that the 2008 tax instructions will “include a worksheet to help those who did not qualify for a payment or those who received a reduced amount determine if they can obtain a benefit when they file their 2008 tax returns next year.” My cynical take on it is that the IRS wants to make sure that everyone files – again.
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
Have a question? Ask the taxgirl!
