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Some married troops cannot get rebate checks

If you are filing a joint tax return with a spouse who does not have a valid Social Security number, you cannot receive the economic stimulus rebate of up to $1,200 per married couple, plus $300 per qualifying child, according to IRS regulations.

The payments, which will be mailed out beginning in May, are an effort by the federal government to pump money back into the economy in the wake of the downturn sparked by the home mortgage crisis.

“Here in Japan, there are large numbers of [service] members married to non-U.S. citizens” who have Individual Taxpayer Identification Numbers, not Social Security numbers, Navy Master Chief Fire Controlman Robert Collins wrote in an e-mail.

Collins is a command financial specialist and a representative of the IRS’s Volunteer Income Tax Assistance program in Yokosuka.

According to the IRS, the law does not allow people who file a return that includes an ITIN to receive the stimulus payments.

There is a possible solution: The member could file a separate return under “married filing separately” status. He then could qualify for an economic stimulus rebate, but that would be based on income, deductions and credits, Fenton said.

Filing separately should be carefully considered, IRS spokesman Eric Smith said. Those who file separately generally pay more taxes and can lose deductions. This could more than cancel out the money from the economic stimulus check.

Army Lt. Col. Janet Fenton, deputy chief of estate planning for Army Legal Assistance, said service members can contact their legal assistance offices to help them determine if it would be in their best interests to file separately. The legal assistance offices provide free income tax preparation through the IRS’ Volunteer Income Tax Assistance program to active-duty and reserve members, their families and military retirees.

More information is at http://www.irs.gov, including a rebate payment calculator at http://www.irs.gov/app/espc.

Many people already have filed their 2007 taxes. Anyone who wants to change their filing status to married filing separately must file an amended return by their original tax filing deadline, IRS spokesman Smith said. That is generally April 15, although some people are eligible for extensions — deployed service members, for example.

There is an additional wrinkle: To qualify for the rebate of $300 per child, the child must have a valid Social Security number.

Both the basic stimulus rebate and the additional payments for qualifying children under age 17 begin to phase out when adjusted gross income reaches $75,000 for individuals or $150,000 for married couples filing jointly.

The combined payment is reduced by 5 percent of the income above the adjusted gross income thresholds.