The Federal government has been endeavoring to stimulate the economy for the past several years. There is a new (income) tax credit that is available to taxpayers when they file their 2009 Federal tax return. It is obtained by completing Schedule M and submitting it with your tax return. USA Today recently reported that if you do not complete this schedule the Internal Revenue Service will review your return and determine your eligibility. However, the processing of your tax return (and possible refund) will be delayed by two to three weeks.Â
The Making Work Pay tax credit is a new credit worth up to $400 for individuals and $800 for married couples that was established by the American Recovery and Reinvestment Act of 2009. Millions of hardworking Americans have already received the benefit of this credit every pay period through reduced tax withholding.
Some beneficiaries of Social Security, Veterans and Railroad Retirement programs, may have also received a $250 one-time Economic Recovery Payment in 2009. Early tax filing trends indicate that some working taxpayers who received the Economic Recovery Payment, and are also eligible for the Making Work Pay tax credit are slowing down their tax refunds by not properly reporting the $250 payment on their tax returns. Anyone who received the one-time Economic Recovery Payment must reduce the Making Work Pay credit they claim by the amount of the one-time payment.
To find out if you received a 2009 Economic Recovery Payment, please call our automated telephone service at 1-866-234-2942 and select Option 1. Starting March 23, 2010, use the Did I Receive a 2009 Economic Recovery Payment? online tool to verify whether you received the payment.
You can be sure to properly account for the Economic Recovery Payment by properly reporting it on IRS Schedule M when you claim the Making Work Pay tax credit. If you received a one-time payment, but do not report it on your return, it will slow your refund. For more information see the instructions to Schedule M.
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