|
Timetable Set for Distribution of Stimulus Payments
As Reported in Essentials Tax Weekly March 31, 2008
The IRS announced that it will begin sending more than 130 million taxpayers economic stimulus payments beginning May 2 (IRS News Release IR-2008-44, 3-17-08). Payments will be deposited or mailed weekly through July 11. Taxpayers can determine the projected amount of their payment by using a calculator located on the IRS website.
Payment Schedule. Rebate payments will be made depending on the last two digits in the taxpayer’s Social Security number and whether the taxpayer chooses a direct deposit on their 2007 return. In the case of joint filers, the first Social Security number listed on the 2007 return controls the payment date.
Taxpayers who choose direct deposit on their federal income tax returns can expect to receive their economic stimulus payments between May 2 and May 16 provided their returns were received and processed by the IRS by April 15, 2008. Rebates will be electronically deposited in the following order: if the last two digits of the recipients Social Security number are 00-20, the rebate should be directly deposited by May 2; if the last two digits are 21-75, the rebate should be directly deposited by May 9; and if the last two digits are 76-99, the rebate should be directly deposited by May 16.
Comment: Taxpayers who elect to split their 2007 refund between several accounts will not receive a rebate by direct deposit. They will receive paper checks.
For taxpayers who did not choose direct deposit on their 2007 tax return, but whose returns were processed by April 15, paper checks will be mailed starting May 16, with the initial mailings completed by around July 11. Rebates will be mailed in the following order: if the last two digits of the recipients Social Security number are 00-09, the rebate check should be mailed by May 16; if the last two digits are 10-18, the check should be mailed by May 23; if the last two digits are 19-25, the check should be mailed by May 30; if the last two digits are 26-38, the check should be mailed by June 6; if the last two digits are 39-51, the check should be mailed by June 13; if the last two digits are 52-63, the check should be mailed by June 20; if the last two digits are 64-75, the check should be mailed by June 27; if the last two digits are 76-87, the check should be mailed by July 4; and if the last two digits are 88-99, the check should be mailed by July 11.
Comment: The schedule for both direct deposit and paper checks is dependent not only on when the taxpayer’s 2007 tax return is filed, but also when it is processed by the IRS. Thus, the IRS has warned that a small percentage of taxpayers may not receive their rebate according to this schedule. This is due to the fact that some returns will require additional time to process and to compute a rebate amount. Practitioners could also surmise that the closer a client’s return is filed to the April 15 deadline, the more likely that any rebate payment may be delayed.
Filing extensions. Rebates will be delayed for returns that the IRS processed after April 15. Individuals who file a return after April 15 can expect to receive their rebates approximately two weeks after receiving their refunds. However, individuals must file by October 15 to ensure they receive a rebate in 2008. |
