Filing Your 2008 Taxes With the Economic Stimulus (Recovery Rebate Credit)

how to file for 2008 taxes

If you didn’t received a payment from the economic stimulus that was devised by the United States government last year and your situation now qualifies you for the credit, you should claim this amount when filing your 2008 taxes.

On the 2008 tax filing forms, there is a line designated to enter this amount, listed as the recovery rebate credit. On the traditional 1040 form, it is line 70. On the 1040A, enter your economic stimulus amount on line 42. The 1040EZ requires the rebate credit on line 9. Here is what the line looks like on the 1040; click on the thumbnail for a larger snapshot.

The instructions for all three forms include a worksheet to help you calculate how much of a credit you should receive towards your 2008 tax due. By following the instructions on the worksheet, you can calculate the credit you should receive based on your 2008 tax situation, list the credit you received last year if any, and subtract the latter from the former to get the amount of the remaining credit owed to you.

If the result is a positive number, you can claim an

additional credit. If the result is a negative number, you don’t have to pay back what you received in 2008. You get to keep the excess credit you received. In most cases, if you received a payment in 2008 for the economic stimulus, you will enter zero on this line.

To simplify everything, just enter “RRC” on this line on the tax form. This will instruct the IRS to calculate the recovery rebate for you. Also, if you file electronically, your software will ask you the appropriate questions to calculate the recovery rebate.

Just so it’s clear, the 2008 economic stimulus is a new credit that’s appearing on the 2008 income tax forms that are due in April 2009. Either you received your credit as an advance in 2008 (the “economic stimulus payment” ) or you claim it when filing your taxes (the “recovery rebate credit” ); thus, the net effect is the same.

Updated September 13, 2011 and originally published January 2, 2009. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

Source: www.consumerismcommentary.com

Category: Taxes

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