Wednesday, March 05, 2008

A Dollar for Your Thoughts: IRS OKs $1 Dollar Returns for Certain Taxpayers

The Internal Revenue Service recently announced that $1 tax returns for retirees with Social Security or similar benefits will be accepted so long as taxpayers comply with IRS Notice 2008-28 and have no other sources of gross income. The scenario came about through the combination of a $300 benefit for Social Security recipients; a requirement of $3,000 in qualifying income (which includes Social Security and related retirement income) and the fact that Social Security is not taxable income if other sources of AGI are less than about $25,000. Taxpayers must be careful to note that this ruling does NOT absolve taxpayers of reporting actual AGI from other sources.

The headline on this article may confuse some readers; at first, it looked like a many taxpayers and not just Social Security (or like) taxpayers were eligible. Guess this is a solution of convenience.


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