Question:
I have heard a lot about the federal stimulus package and the government sending out rebate checks to taxpayers. I’m eligible for a payment but I still owe federal income tax from a prior year. Will I still receive my rebate check?
Answer:
The stimulus payment is treated like any other tax refund. This means that part or all of your payment can be used to pay past-due federal or state income taxes or non-tax federal debt such as student loans and child support. So, unfortunately, if you owe any past due income taxes or other non-tax federal debt then the IRS will be reducing the amount of your rebate check. If the IRS reduces your check, they will send you a letter explaining how the stimulus payment was applied.
[...] wrote a short post a few months ago about how the federal stimulus package (i.e. rebate checks) would effect your IRS tax liabilities. Since then, I have received a number of queries on this IRS Problem Solving Blog about how the [...]
I owed the IRS $300 in 2007. At the time my taxes were filed I paid $150 via direct deposit, this was cleared by my bank on Apri 16, 2008. Will owing the other $150 prevent me from getting my economic stimulus payment, delay it, or cause me to receive a paper check instead of direct deposit? According to the IRS schedule I should have received my stimulus on May 16, it is now May 30. I have used the IRS.gov stimulus tracker thing and it says it cannot find my info. I just got a bill in the mail for the second $150, which I can pay now, but I am afraid I’ll receive my stimulus minus the $150 that I owe. The bill does not mention anything about it being deducted from my stimulus payment. Thanks!