6 reasons you might not see an IRS ‘stimulus’ check
The IRS has released its delivery schedule for advanced recovery rebate payments. The IRS will issue these "stimulus checks" between May and July for taxpayers who filed their Form 1040 on time. The order of payments will be based on the last two digits of a taxpayer's Social Security number. (For a jointly filed return, payment schedule will be determined by the first Social Security number listed.)
The IRS says a small percentage of tax returns will require additional time to process. For these returns, stimulus payments may not be issued in accordance with the schedule above, even if the tax return was processed by April 15.
There are six reasons the rebate check may not make it to your pocket. Hawaii taxpayers should spend carefully until they know how much they'll get. Some taxpayers will not be eligible for a check at all, and could end up in a bind if they've already hit the mall counting on their rebate.
Why you may not be eligible for a timely rebate:
» You owe taxes.
If you owe back taxes to the IRS or any state government (including Puerto Rico and American Samoa), you could see your rebate slashed or cut altogether.
» You make too much money.
Rebate payments will begin to phase out for taxpayers with adjusted gross incomes of more than $75,000, and for married couples filing jointly with income over $150,000. If your adjusted gross income is above those levels, calculate your rebate carefully before going on a spending spree. Payments start reducing by 5 percent of all adjusted gross income above the phase-out limits.
» You don't make enough money.
If you have less than $3,000 in qualifying income, don't expect a rebate. Only those with $3,000 or more of income will be eligible. However, taxpayers can count income normally exempt from taxation, like Social Security or veteran's benefits, to reach that level.
» You don't file a tax return.
If you don't file a return, you won't receive a rebate. If you have more than $3,000 in qualifying income and are not required to file a return, you should still do so in order to receive a rebate.
» You're unlucky.
The rebates will be paid out according to the last two digits of the taxpayers Social Security number. The IRS warns that a small percentage of returns will take additional time to process. Taxpayers should be cautious of purchasing on credit in anticipation of a quick rebate check; they may pay unexpected interest if their return is held up.
» You don't have a valid Social Security number.
Taxpayers without Social Security numbers who file tax returns using an IRS Individual Taxpayer Identification Number are not eligible for a rebate. If married filing jointly, each person must have a valid Social Security number to receive the rebate.
Doreen Griffith is managing partner for the Honolulu office of Grant Thornton LLP. She can be reached at Doreen.Griffith@gt.com