What Do You Have to Do to Get a Check?  
-To get a rebate check, you must file a tax return; either a form 1040, 1040A or 1040-EZ federal tax return for tax year 2007. You can file for free with Tax Cut.

–Persons who do not normally file tax returns, like retirees, will have to file a 2007 tax return in order to get a rebate check.

When Will the Checks be Mailed?
–The IRS will begin mailing the rebate checks starting on May 2. The Treasury estimates that it should take about 10 weeks for all the checks to be mailed.

-Persons who fail to file their 2007 tax returns by April 15, 2008 and request a filing extension may not receive rebate checks until as late as December.

Who Will Get Tax Rebate Checks? How Much Will You Get?

–Single tax filers with adjusted gross income (AGI) less than $75,000 and couples filing jointly with AGIs less that $150,000 will qualify for full rebates.

–Qualifying single filers (AGI less than $75,000) will get rebates of up to $600. Qualifying couples (AGI less than $150,000) will get rebates of up to $1,200, plus $300 per dependent child, with no maximum on the number of eligible children.

–Persons who owe no income taxes, but earned at least $3,000 in wages, Social Security benefits or veterans disability benefits will get rebate checks of $300 for individuals and $600 for couples.

What if You Made More than the Maximum Income? 
You will still get a check, but it will be reduced by 5-percent of the amount you earned above the AGI income caps of $75,000 for single filers and $150,000 for couples.  At some income point above the AGI income caps, the rebate checks will phase out completely.

–For Singles, the phaseout levels begin at $75k and end at $87k, at a reduction of 5% per $1,000 over the lower limit. If you earn above $87k, you’re over and thus get nothing.

–For couples, the phaseout levels begin at $150k and end at $174, at a reduction of 5% per $1,000 over the lower limit. If you earned above $174k, you’re over and also get nothing.

Some people won’t get a stimulus payment. How do you know if you’re one of them?

You won’t get a stimulus payment in 2008, if any of the following apply to you:

–Your net income tax liability is zero and your qualifying income is less than $3,000. To determine your qualifying income, add together your wages, net self-employment income, nontaxable combat pay, Social Security benefits, certain Railroad Retirement benefits and certain veterans’ payments.

–You can be claimed as a dependent on someone else’s return. For example, this would include a child or student who can be claimed on a parent’s return.

–You do not have a valid Social Security Number.

–You are a nonresident alien.

Not filing because you cannot afford to pay - If you don’t file because you can’t pay the entire tax due, you will only increase the amount you will have to pay later with additional and increased penalties. If you enter into an installment arrangement with the IRS, and your return was filed on time, the late payment penalty you pay monthly on the outstanding balance will be reduced from .5% to .25%.
 
Not making Estimated payments - Estimated tax for payers with income above $75,000 for single filers/ $150,000 for joint filers has significantly increased over the past two tax years.  For 2007 you had to remit 110% of your 2006 tax liability.
 
Paying the Kiddie Tax - You don’t have to wait for a savings bond to mature to report the interest.  You can periodically report the interest.  This is especially favorable for children in years where they have no income or are below the threshold.
 
Missing, duplicate or incorrect Social Security Number - The IRS will issue a partial refund until they can verify the information on the return.  They will recalculate your tax liability based on the information they have and you could wind-up with a tax bill instead of a refund.
 
Wrong filing status - Choose the best filing status for your circumstances.  Some overlook head of household status, which is a more favorable rate of taxation. Qualified widows (ers) can file at joint rates for the two years following their spouses’ death.
 
Not claiming moving expense for first job. Moving expenses to get to that first job are deductible. And you get this write-off even if you don’t itemize. If you moved more than 50 miles, you can deduct the cost of getting yourself and your household goods to the new area, including 18 cents a mile (and parking fees and tolls) for driving your own car.
 
Not qualifying for the residential sale exclusion – If a seller fails to reside in a house two out of the last five years that fat $250,000 ($500,000 if filing jointly) exclusion could be lost. A prorated exclusion may be available.  Under certain circumstances you can add-up the occupancy period of spouses and /or if the sale is due to unemployment, military deployment or other unforeseen circumstances.
 
Not claiming student loan interest paid by mom and dad – Until recently, if parents paid back a student loan incurred by their child, no one got a tax break. Now there’s an exception. If mom and dad pay back the loan, the IRS treats it as though they gave the money to their child, who then paid the debt. So, a child who’s not claimed as a dependent can qualify to deduct up to $2,500 of student loan interest paid by mom and dad.

1) Retirement Contributions
Strategy
If you haven’t contributed the maximum for your 401k or IRA for 2006, increase contributions in November and December.

Savings
Contributions to your regular IRA and 401k will reduce your Adjusted Gross Income (AGI), lowering your overall tax bill. Read more about your AGI in this article by Five Cent Nickel.

Things to Consider
Unlike a regular IRA, contributions to your Roth IRA will not reduce your adjusted gross income but will still pay off big time in the long run! The 2006 contribution deadline for both the Regular and Roth IRA is April 16 2007.

2) Charitable Giving
Strategy
The rules around tax deductions for charitable giving have become more stringent and require additional documentation in 2006. Make sure you are familiar with these rules.

Savings
Various. The key point here is to deduct and document the donations appropriately. Things to Consider The press release notifies us of the following:

• “After Aug. 17, 2006, donations of clothing or household items that aren’t in ‘good used condition’ or better won’t be tax-deductible”

• “An additional form must be filled out to claim a deduction for non-cash contributions that total more than $500. The IRS also may disallow deductions for items that have little or no monetary value.”

• “For cash donations of $250 or more made during 2006, deductions are granted only with written acknowledgment from the qualified organization. For 2007, all cash contributions must be documented with a bank record, such as a cancelled check, or a written acknowledgment from the qualified organization.”

3) Energy Efficient Home Purchases
Strategy
Lower your energy bill with qualifying energy-efficient home improvements and also earn a tax credit.

Savings
This strategy offers a $500 maximum one-time credit for 2006.

Things to Consider
The press release reminds us that this credit “applies to qualifying energy-efficient home improvements” and that we should “look for certification that the item is eligible for the credit”. Purchases must be made by the end of 2006.

4) Education Expenses
Strategy
Pay any spring 2007 semester college tuition bills in 2006.

Savings
Someone with modified AGI under $45K ($90K for married taxpayers filing jointly), may qualify for the Hope or Lifetime Learning credit. Learn more about the Hope at H&R Block or the Lifetime Learning credit at Free Money Finance.

Things to Consider The credit is not available for people with modified AGI of $55K or more ($110K for married taxpayers filing jointly) and begins phasing out at modified AGI of $45K ($90K for married taxpayers filing jointly).

5) Hybrid Vehicle Purchase
Strategy
If you’re planning on buying a hybrid vehicle, do it before the end of 2006.

Savings
The press release says the purchase “could qualify taxpayers for tax credits ranging from $250 to $2,600, depending on the make and model of the vehicle and when the purchase is made.”

Things to Consider
The tax credit varies widely between make and model so research this before buying.