April Newsletter, 2008

Welcome

Dear present and former clients,

In an effort to keep you informed about matters which may be of interest to you, my office will be periodically posting information relating to consumer financial matters. This information will be available through e-mail newsletters, such as this one, and also on our newly updated website.

I hope you will find this information helpful and informative. If you prefer not to receive e-mails from our office, simply choose the “Manage your subscription” option at the bottom of this page.

Thank you, and please don’t hesitate to call if we can be of assistance to you.

Sincerely,

Richard L. Banks

Visit Us on the Web

Please visit our newly updated website at: www.rbankslawfirm.com

Here, you will find up-to-date information about our office and how to contact us, as well as current bankruptcy information. Also, new clients can now pre-register for their first appointment online (see information below).

Online Pre-Registration

In an effort to better serve our potential new clients, we are now offering the convenience of online pre-registration for your first appointment.

How does it work?
1. Call our office to set up an initial appointment.

2. Prior to your appointment, log onto our website and select “Pre-Register” on the Home Page menu.

3. Click “Create New User Account” to set up your personal account. You will need to create a user name and password that you can remember. It’s a good idea to write it down.

4.Begin entering your information in each of the requested categories. Be sure to click the ‘Save’ button before moving on to the next category.

5.Don’t have time to complete all of the information at one sitting? No problem. You can log off and come back later. When returning to the pre-registration page, just enter your user name and password in the “Log In” box. This should pull up everything you’ve already entered and get you started right back where you left off.

6.Check the “Online Registration FAQ” page for more answers to any questions you may have.

Here’s stimulus: What you need to know
A how-to guide for checks that could be coming to your mailbox soon.

By David Goldman, CNNMoney.com staff writer
Last Updated: April 28, 2008
NEW YORK (CNNMoney.com) — Imagine your rich uncle calls up out of the blue and says, “I’m going to send you six hundred bucks – spend it however you want.”

That’s exactly what’s Uncle Sam is about to do for millions of taxpayers. Here’s what every tax filer needs to know about the soon-to-be-distributed stimulus checks.

What is this program all about?
Tax rebate checks will be distributed to most tax-paying Americans. The rebates serve as a one-time tax cut initially based on their 2007 incomes.

Overall, the Treasury will distribute more than $110 billion to 130 million taxpayers by July.

The government hopes to stimulate the flagging economy by putting some extra cash in people’s pockets – cash they can spend, add to their savings account, and use to help pay next month’s mortgage. As long as they don’t put it under their mattress, President Bush and Congress – who came together earlier this year to pass a so-called economic stimulus package – will be satisfied.

“Beginning Monday, the effects of the stimulus will begin to reach households,” President Bush said Friday. “This money is going to help Americans offset the high prices we’re seeing at the gas pump and at the grocery store.”

When can I expect my payment?
The order in which tax filers will receive their rebates will be based on the last two digits of their Social Security numbers, when they filed their ’07 tax forms and whether they opt for direct deposit.

The Treasury Department said it hopes to get the first $50 billion out by the end of May. People who use direct deposit will get their payments soonest. By the end of next week, checks will have been deposited into the bank accounts of 7.4 million people. Most people will get their payments by July 11.

If you’re a laggard or had to file for an extension, you’ll still get a check but it may not come until the end of the year – probably in time for Christmas shopping.

Who will be getting checks?
One-time payments will be sent to at least 117 million low- and middle-income households, 20 million senior citizens living off of Social Security and 250,000 disabled veterans.

To be eligible for a full rebate, single tax filers must have 2007 adjusted gross income (AGI) below $75,000 and joint filers must have AGI below $150,000.

Single filers with AGI below $75,000 will get rebates of as much as $600. Couples with AGI below $150,000 will receive rebates of up to $1,200.

In addition, parents will also receive $300 per child under 17; there is no cap on the number of qualifying children eligible.

Tax filers who do not owe income taxes, but have at least $3,000 in income – which can include Social Security and disability payments – will get $300 rebates per person or $600 per couple.

The stimulus allows for a 5% phaseout rate for households above the income caps of $75,000 for single filers and $150,000 for joint filers. The rebates of those taxpayers will be reduced by the amount of income above the cap multiplied by 5%.

Will I have to pay it back?
No. And here’s why.

Your stimulus payment is a one-time tax cut – an advance on a credit you’ll receive on your 2008 return. You will not owe tax on your payment when you file your 2008 tax return, and it will not increase the amount you owe or reduce your 2008 refund.

The stimulus payment is based on your 2007 income initially. If it turns out that your 2008 income and number of children would have qualified you for a larger rebate than the one you received, you’ll be sent the difference. If it turns out your 2008 income was lower than in 2007 and you should have gotten a lower rebate, you get to keep the difference.

“If you were supposed to receive a larger payment than you did, you will get the extra money,” said Treasury spokesman Andrew DeSouza. “If you received more than what you should have gotten, you will not be penalized.”

OK, how do I get my check?
You must file a federal tax return for 2007.

Some low-income workers, Social Security beneficiaries and others are not required to file a return but are still eligible to receive stimulus checks. To receive their payment, they must file a 1040A federal tax form by Oct. 15 and write “Stimulus Payment” at the top, or use a special electronic form located on irs.gov.

Beyond that, leave the rest of the work to the IRS, which will calculate how much you will receive and send you your check.

– CNNMoney.com staff writers Jeanne Sahadi and Catherine Clifford contributed to this report.