by Clynt Ridgell, KUAM NewsFriday, May 09, 2008 Subscribe to Clynt's newsfeed
While many on Guan are anticipating receiving their tax rebates, it seems as if just as many are still confused. Some of the questions being thrown out there include things like what is a tax rebate? Who is eligible? And why are some checks being garnished? Rev & Tax director Art Ilagan joined KUAM News today to hopefully clarify the tax rebate issue once and for all.While the island is abuzz with talks of tax rebates many are still left wondering what a rebate really is, the director said, "A tax rebate is a refund of a prior year; it's refunding a return after a due date. So the rebate today that we're getting is funded by IRS, but it is a refund of taxes from 2007." Remember, while you may file your taxes in 2008 you're actually filing for 2007. All the documents you turn in are based on the money you made in 2007. Therefore, those who filed before or on the April 15 deadline this year will get their rebates for 2007.(That is, unless you haven't filed for previous years or if you owe money to the Government of Guam.) This has been the subject of much debate, but Ilagan says because a rebate is just like a refund - the agency has every right to offset what is owed to them with the rebates. "It's within our authority to offset it's also in our memorandum of understanding with the Internal Revenue Service that we offset any rebates as if it's an overpayment of tax," he explained.In fact, Ilagan has shown us a section on the IRS online newsletter that says some taxpayers may receive smaller rebates than anticipated because by law the stimulus payments are offset to satisfy past due taxes child support and certain other debts. Ilagan even produced a letter from secretary of the U.S. Department of the Treasury, Henry M. Paulson, Jr., stating that the rebates are subject to the refund offset provision.The letter also states that the rebates are to be treated as a refund of an overpayment of tax.