Stimulus and Other Tax Laws Give New Immigrants Opportunities for Big Tax Refunds

April 6, 2009 - PRLog -- Some qualifying new immigrants may receive thousands of tax dollars from the government. On the other hand, immigrant retirees who collect their retirement or disability benefits abroad will not receive the one-time economic recovery payment.

Recovery Rebate Credit

Last year, Americans received economic stimulus rebate: a check for up to $600 per adult and $300 per child. This year some taxpayers may receive the recovery rebate credit. People who fall into the categories described below may be eligible for the recovery rebate credit this year:

•   Individuals who did not receive an economic stimulus payment.
•   Those who received less than the maximum economic stimulus payment in 2008 — $600 per taxpayer; $1,200 if married filing jointly — because their qualifying or gross income was either too high or too low.
•   Families who gained an additional qualifying child in 2008.
•   Individuals who could be claimed as a dependent on someone else’s tax return in 2007, but who cannot be claimed as a dependent on another return in 2008.
•   Individuals who did not have a valid Social Security number in 2007 but who did receive one in 2008.

Attention new Americans: Those who legalized their immigration status and received a valid Social Security number in 2008 as well as those who brought their children to the U.S. in 2008 may obtain up to $300 from the government. To claim the recovery rebate credit, fill out Form 1040, 1040A or 1040EZ. Follow the instructions. Unlike the economic stimulus payment, the recovery rebate credit will be included in your tax refund for 2008 and will not be issued as a separate payment.

Recovery Rebate Calculator at the IRS website (www.irs.gov) can help determine whether you qualify for the rebate or not.

One Time Payment for Retirees

The American Recovery and Reinvestment Act of 2009 provides for the one-time payment of $250 to be made in 2009 to:

•   retirees, disabled individuals and Supplemental Security Income (SSI) recipients receiving benefits from the Social Security Administration.
•   disabled veterans receiving benefits from the U.S. Department of Veterans Affairs.
•   railroad Retirement beneficiaries.

“To receive the payment, your address of record must be in the United States.” said Elzbieta Baumgartner, a financial writer specializing in immigrants’ issues and the author of newly published guidebook ‘Starting Over in the U.S. While Waiting for Your Green Card’ (http://www.newamericanguides.com). “Also, one needs to be eligible for those benefits on November 2008, December 2008, or January 2009.”

The IRS will not make the payment but the agency that pays the benefits.

Claim Benefits of Earned Income Tax Credit for Past Years

It pays to know that besides stimulus refunds, new immigrants have another opportunity to get significant tax money.

Those newcomers who worked and paid taxes in the past using an Individual Taxpayer Identification Number (ITIN) while waiting for their Green Card, now, after legalizing the immigration status, they may have a big refund coming their way thanks to the Earned Income Tax Credit. The amount of EITC, a federal tax benefit for low- and moderate-income workers, depends on income and family size. For tax year 2008, the maximum credit amounts are $4,824 for families with two or more children, $2,917 for families with one child, and $438 for families with no children.

In order to qualify for the EITC, you must have a valid Social Security Number and moderate earned income from employment or from self-employment, you must be a U.S. citizen or resident alien all year, and your filing status cannot be married, filing separately. ITIN taxpayers are not eligible. However, once they obtain their Social Security number, they may file amended tax returns for past three years and claim the credit.

“This tax season, immigrants have several opportunities to receive sizable checks from the government. They should take advantage of them.” Concluded Mrs. Baumgartner.

More information can be found in the IRS Publication 596, Earned Income Credit www.irs.gov/pub/irs-pdf/p596.pdf)  and at www.cbpp.org/eic2009.

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Polpress is a New York based publisher founded in 1989, devoted to economic empowerment of new Americans. It has published over thirty guidebooks in the New American Guides series on subjects of interest to all immigrants http://www.newamericanguides.com