Can you explain what net income tax liability means?

Question

I received $300 for my IRS stimulus payment. This was primarily based on my net income tax liabilty. It was not greater than $600, therefore I was declined the (personally) expected amount of $600.

I filed a W2 and a 1099, had a few write off's due to self-employment purchases, and I was able to claim the tuition I paid in 2007. If it helps to know, the "tax" amount (Lines 44 and 45 added together) and the "total credits" amount (Line 56) were the same. Because they were the same, the amount of tax after credits (Line 57) was 0 (zero). And according to the IRS, this amount needs to be greater than $600 for a single filer to receive a stimulus payment of $600.

My mom, who made close to $75K, received more than I did, when I earned slightly over $21K.

If anyone can help me understand this, I would be very grateful! Please know I will not take offense to anyone explaining this to me like I'm a four year old. In fact, I suggest doing just that if you can!

Thank you!

Answer 1

Your net income tax liability is one of the following depending on which form you filed:

·On Form 1040, the amount shown on Line 57 plus the amount on Line 52;

·On Form 1040A, the amount shown on Line 35 plus the amount on Line 32; or

·On Form 1040EZ, the amount on Line 10.

Your stimulus payment is based on your net federal income tax for 2007. If your tax was between $300 and $600  on your return, you get back everything you paid. If your tax was less than $300, you get an even better deal, and get $300, even MORE than you paid in. If you paid over $600 though, your rebate is limited to $600.

Answer 2

Just take what was given you and be grateful. If you begin making comparisons you will unlikely come up with the wrong answer since it appears that no standard practice was put in place. Thank the Democrats for that, Thank President Bush for whatever stipend you received.

Answer 3

In your case, since you have no dependent under age 17, your net tax liability is the amount on Line 57, zero.  This is the amount you paid in taxes.  

Because your income was over $3,000, the rules for the rebate resulted in your getting a $300 "rebate" even though you have zero tax liability.

Your mother, who was in a higher tax bracket, was not able to reduce her tax liability to zero.  She may have received up to $600 or her tax liability whichever is less (but not less than $300).