Rebates for Individuals

Reconciliation of rebate on 2008 Form 1040: The stimulus amount will ultimately be based on results of the 2008 Form 1040. Accordingly, the advance rebate paid to taxpayers in 2007 will need to be reconciled to the amount computed when preparing their 2008 Form 1040.

a. If the advance rebate paid in 2007 exceeds the computation based on the 2008 return, no repayment of the excess is required.
b. If, however, the advance rebate is less than the computation based on the 2008 return
(e.g. if 2008 AGI is lower and the phase out is diminished), the taxpayer can claim the difference as a credit against the 2008 tax liability.
c. In the case of an advance rebate to a joint return, one-half is allocated to each taxpayer for 2008.
d. Some individuals may not have been eligible in 2007 but may become eligible in 2008, thus qualifying for a credit against their 2008 tax liability.