<p>You would think that with ALL of the press this rebate is getting, there would be answers to the following questions…somewhere. We are trying to figure out whether or not DD should file taxes (no withholding but earned more than $3000). It sure would be nice to have answers.</p>
<li><p>Does one have to file income taxes to be eligible for this rebate?</p></li>
<li><p>How is “children” going to be determined for the parents? Will this be under 18 years of age, or anyone who is declared as a dependent?</p></li>
<li><p>If the parents get to “count” the college kids as dependents, will the parents get the higher rebate?</p></li>
<li><p>If the parents get a rebate for their college aged kids, are the KIDS still eligible for the rebate too if they earned more than $3000?</p></li>
<li><p>When do you suppose the guidelines for this will be released?? I’m sure I’m not the only one on the planet who wants to finalize a FAFSA and needs to determine tax filing status for an offspring.</p></li>
</ol>
<p>Bottom line is the kid won’t bother filing if she isn’t going to get the rebate. I suppose we could just file anyway (it’s freefile for her), but how odd to file when one had no withholding and is under the income/interest threshold for filing.</p>
<p>thumper, yeah I had similar questions. Both of my kids have to file because they have withholding and sold stocks/mutual funds to pay for college tuition bills. My CPA says its going to be a while before it all gets straightened out and that is best to just go ahead and file. As far as tax filing status for offspring, you might have to crunch the numbers both ways but generally when I have and when my CPA has we decided it is best for parents to declare kids as dependents. I would file for her but indicate that she will be claimed as a dependent on your return. YMMV.</p>
<p>We ARE declaring both kids as dependents. That is not the question. The question is IF DD is declared as a dependent, will DH and I get any rebate money because of her. OR is she not considered a “child” because she is over 18? If so, she will file and get her own rebate. Last time there was a rebate, DS was over 18 and he did not “count” in the “kid count”. I wish they would publish the rules.</p>
<p>Columbia-student…no Roth IRA…no money left to contribute to it. it’s all going to college tuition.</p>
<p>One thing to consider is that the rebates are based on gross income and I believe they start to phase out at $150,000 family income… so if you think you might hit that, it might be good to let her file her own return.</p>
<p>Well, that bites…I had more or less figured that S (who is 18) would still be counted as a child since he’s still our dependent. Figures that we won’t get any money for him just at the time when he’s costing us more than he ever has before. AARRGGHH.</p>
<p>Will it even be based on the 2007 return, or the 2006. Seems hard to believe they will start sending checks in May, based on returns not due until April 15.<br>
If my college aged kid made $10,000 in 2007, would he get a rebate if he claims himself instead of us claiming him? Since we won’t get a rebate for him. I’d do taxes both ways and see which one gets the family more money, but that’s hard to do if we don’t know the rules.</p>
<p>Reading both sets of rules it sounds like either way no rebate for kids who are 18. 3bm103, I think you may still want to pencil the taxes out both ways…agreed it is hard since we don’t know what will actually be passed.<br>
I had to laugh on on the Roth IRA comment. I had the same thought…no money for retirement till we get through paying the private school tuition.<br>
If there are those out there who can get their college kids to fund IRAs while they are paying for college, good for you.</p>
<p>I think the answer is that there is no answer yet. Legislators are still debating the issue. Some want to expand tax rebates to those who don’t pay income taxes(the original intent of the bill was for taxpayers). Good or bad idea is another topic, but that issue and others are still being debated. Not to underestimate any posters here, but I don’t think final answers can be given here until the measure reaches its final stages.</p>
<p>I am trying to figure it out. I think my daughter will actually get the $300 after all. She does not have $3,000 of earned income (just under) but she does have a tax liability greater than zero and gross income greater than the standard deduction (because of taxable scholarships). I will keep my mouth shut just in case - then it will be a nice surprise for her. </p>
<p><a href=“A”>quote</a> has qualifying income of at least $3,000, or</p>
<p>(B) has–</p>
<p>(i) net income tax liability which is greater than zero, and</p>
<p>(ii) gross income which is greater than the sum of the basic standard deduction plus the exemption amount (twice the exemption amount in the case of a joint return).
<p>“If there are those out there who can get their college kids to fund IRAs while they are paying for college, good for you.”</p>
<p>Many years ago our local paper published an article by a financial advisor on just this topic. He said that a friend asked him how to get his son to contribute to his retirement plan when the child says that he’s barely scraping by now, but when he’s older and has more spare money he’ll do it.</p>
<p>So the advisor sat the kid down and told him that an 18 yr old invested $2000 in his IRA every year for 6 years, and then stopped. While his friend waited until he was 24 and then started his contributions, how many years would the second student have to invest before he caught up to the first? </p>
<p>Any body have any ideas? Ten years? Twenty maybe?</p>
<p>The answer is that the second would never catch up. Even if the first never contributed anything after those first six years. </p>
<p>I showed that article to all three boys and all three started putting whatever they could into Roth Iras. Even better than regular.</p>
<p>Oh - read it further. She will not get it because we can claim her as a tax deduction. Darn.</p>
<p><a href=“3”>quote</a> ELIGIBLE INDIVIDUAL- The term `eligible individual’ means any individual other than–
`(A) any nonresident alien individual,
`(B) any individual with respect to whom a deduction under section 151 is allowable to another taxpayer for a taxable year beginning in the calendar year in which the individual's taxable year begins, and
`(C) an estate or trust.
[/quote]
</code></pre>
<p>Darn. She is so good with her money and working I would have like to have seen her get it. Oh well.</p>
<p>That scenario depends A LOT on your market assumptions. If you invested in 1967 you had about the same amount in 1977. The market does not always go up. If you invested that $12,000 all in Year 1 after 24 years you would only have $24,400 if the market goes up 3% a year steadily. Now which would you rather do–spend $12,000 when you are young and studly or have $24,000 when you are in middle-age and paunchy?</p>
<p>Hmmm…we think DD IS eligible for the rebate. She is a dependent on our taxes, but we don’t think she will “count” as a child towards OUR rebate. She did earn over $3000 this year. We were under the impression that if she filed her taxes, she would get the rebate. She had NO withholding so if that’s not the case…let me know ASAP so she doesn’t bother filing at all!!</p>
<p>My reading is that if you are claimed as a deduction by someone else then you are not an eligible tax payer as defined by this act :(</p>
<p>In the text It begins by saying:<a href=“a”>quote</a> In General- In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by subtitle A
[/quote]
</p>
<p>Then goes on later to define <a href=“3”>quote</a> ELIGIBLE INDIVIDUAL- The term `eligible individual’ means any individual other than-- <a href=“B”>b</a> any individual with respect to whom a deduction under section 151 is allowable to another taxpayer for a taxable year beginning in the calendar year in which the individual’s taxable year begins, **
[/quote]
</p>
<p>But I really hope I am reading it wrong. It is hard to follow without the background expertise - for instance I am not sure what section 151 is - going to do some googling. I would have her file just in case - unless some real expert can come and interpret the bill for us.</p>
<p>I think the ‘child’ definition is the same as for the child tax credit rather than the exemption. I am not sure exactly why I think that though :rolleyes: Think I read it somewhere.</p>
<p>Thumper, I’d would have your D file the 1040. The time to complete is very short and done effortlessly. Its a good time for her to learn how to do it. Further the filing provides FAFSA and income verification documentation.</p>
<p>We’ll probably have DD do the tax form regardless. The 1040 EZ is about as EZ as it gets. But I will say it here…we are getting double scr####d. The kids won’t count as “children” on OUR tax returns because for the rebate purposes they are too old. They won’t count on THEIR returns (despite the fact that they earned income) because we declare them as dependents. Once again, we won’t get much of a rebate…if any. Last time we got a whopping $150 (because DS was too old to count as a “child”). This time both kids won’t “count”. I have to tell you…$150 to us would do NOTHING to generate economic recovery. We would use it to pay our electric bill.</p>
<p>Personally I think there should have been something in this bill for parents of college students who are paying tuition. EVERY family paying tuition for the student to attend college should have been eligible for the FULL rebate. Just my stinking humble opinion.</p>