Recovery Rebate

[lsowers]

New client received a CP2000 for 2007. The original return self-prepared by client only qualified them for $300. If the return had been filed with all income they would have qualified for $600. The 2008 return does not have enough income to qualify for the additional $300. Has anyone tried or looked into whether one could claim the remaining $300 recovery rebate credit with the adjustments to the CP2000? If the return had been done properly the first time, she would have gotten the full $600.

Thanks

[RitaB]

New client received a CP2000 for 2007. The original return self-prepared by client only qualified them for $300. If the return had been filed with all income they would have qualified for $600. The 2008 return does not have enough income to qualify for the additional $300. Has anyone tried or looked into whether one could claim the remaining $300 recovery rebate credit with the adjustments to the CP2000? If the return had been done properly the first time, she would have gotten the full $600.

Thanks

I believe you're out of luck. The whole deal revolved around the 2008 income, but if you got too much based on the 2007 return, you got to keep it. Since the amended return is just getting filed now, I think SP is off the table, and all that's left for your client is RRC.

I am glad you asked, because I have a couple who had to amend 2007, taxpayer made an error which son picked up on and told me after filing. Mailed the 1040-X on April 25, 2008 (yes, 2008), and they have a big refund coming. IRS has been "reviewing" the amended return ALL THIS TIME. Clients qualified for $1200 FOR 2007 EITHER RETURN. They even got the letter saying they were entitled to $1200 Stimulus Payment, but they never got it. (Yes, I checked web site, too.)

Now, on 2008, they only qualify for $600 RRC. They are elderly, in fact, the husband has had to go to nursing home, and they really need their refund. They also need the extra $600.

IRS is really dragging their feet on the amended return. They have not requested additional info. I've called twice, and it's always, "The return is under review, no action is needed right now, and your client should hear something soon."

I will be arguing for the extra $600, no question about it. Think client will get it?

[Gail in Virginia]

I think she is out of luck. It was my understanding that after 12/31/08, stimulus was no longer available and recovery rebates would be based only on 2008 returns. If anyone has different information, I would love to see it, but this is how I understood it to work.

[Teri2414]

That is correct - based on 2008 returns - last year's 'stimulus' was an advance on this year's return - that is why certain groups like divorced parents who switch claiming years are also getting $300 for the minor

[jklcpa]

Yeah, I got a return in last night that received $328 stimulus check based on 2007 return (his tax was only $328). He held the check too long, then tried to deposit it. Bank bounced it back as too old & charged him $15 to boot.

He's MFS and qualifies for the $600 based on the 2008 return, but I think he can only get the $272 difference. Do you think there's any chance that he could get the full $600 because he was too lazy to put a check in the bank?