Was the Economic Stimulus rebate check we received last summer an advance on this years taxes?

You are correct about it not being an advance.

The reason you have to reference it on this year's tax return is in case you did not get it last year, or in case you had a 2008 that would have earned you a better rebate than the original which was based on your 2007 return. In that case they would give you more on 2008.

Think of it this way.

Your refund on your 2008 tax return is exactly the same as it would have been if there had *never* been a stimulus package.

Then the government voted a stimulus. This is additional money added to the system during 2008. The government could have waited until now to pass the money out, but chose to distribute it *early* based on the information on your 2007 tax return. If you got the maximum amount early, you don't get it again when you file your 2008 tax return. Since some people didn't file in 2007 (particularly soldiers in combat zones!) or their circumstances changed, the government is giving you a 2nd chance to qualify for the money on your 2008 tax return.

In order to ensure that you only get the money once, the worksheets ask the amount you previously got.

Unfortunately, some individuals are playing with the field, putting in $0 the first time and then the amount they received the second time. With $0, their refund is inflated. When they put in the correct amount it goes back to the amount it would have been if there had never been a stimulus package. But since the amount goes down, they conclude, incorrectly, that they are paying the money back.

No, it doesn't affect your 2008 refund, which is whatever it would have been if there had been no stimulus package or checks. The exception is if you didn't qualify last year, but qualify based on your 2008 return, you'd receive the stimulus payment added to your refund.

Unfortunately, many of the tax software designers took a short cut and calculated the stimulus into your refund for 2008 automatically, then have you subtract it back out if you got it last year. This is causing massive confusion among people who think it's being subtracted from their refunds - it's only being subtracted if it shouldn't have been there in the first place this year since you already got it last year.

The reason they ask what you got last year is that if you quality for more based on your 2008 return, then you'd get the extra. If you don't qualify for more, what you got last year doesn't show anywhere on your 2008 return or affect your refund, it's just used on a worksheet and you don't send that in. What you got last year was an advance on the stimulus payment for 2008, not on your regular refund.

If you use a preparer for your taxes, they'll be able to tell from your 2007 return if you lost the form for your stimulus payment.

The stimulus payment was not an advance, and does not have to be repaid.

Still, there is a line on the 1040 for the Recovery Rebate Credit. That line is for those who were eligible for an advance payment, but did not receive one (or received a lesser amount than what they were entitled). People in those circumstances can get their payment when they file their 1040. Since the amount received must be subtracted when computing one's Recovery Rebate Credit, many mistakenly think it is being repaid.

The Stimulus check is indeed an advance of 2008 tax credit based on your 2007 tax return. When you file your tax return, you'll need to know how much you received last year as the stimulus check. If you qualify for more based on 2008 tax year, then you'll get more after you file 2008 tax return. If you received more based on your 2007 tax return, you don't need to pay it back. Be sure you have the exact amount that you received, otherwise it may delay the processing of your tax return.

Not an advance. You enter the amount so the IRS can verify it was correct. Some people did not get the right amount last year.

How do you lose important tax preparation papers.

Just write down the amount Try and get a better system of storing important records.

What Bob F said!

I wasn't eligible to get it last year but this year I am!

no, it's not an advance at all...