Is a §6676 penalty applicable to a payment made under the Economic Stimulus Act of 2008?
Proposal: Guidance should address whether a §6676 penalty is applicable to the recovery rebate credit and the stimulus payment addressed in §6428 as amended under the Economic Stimulus Act of 2008. On February 13, 2008, the President signed into law the Economic Stimulus Act of 2008 (the “2008 Act”) intended to deliver an expedited fiscal stimulus to the economy.47 The 2008 Act, amends §6428 to provide for “recovery rebates” to eligible individuals with qualifying income.48 In 2008, eligible individuals will receive a refundable tax credit of up to $600 ($1,200 for joint filers) and a child credit of $300 per qualifying child (collectively the “recovery rebate credit”). The recovery rebate credit will be payable in the form of advance rebate checks (the “stimulus payment”) based on a taxpayer’s 2007 tax return.49 In Notice 2008-28, the IRS stated that for eligible individuals who are not required by §6012(a) or §6017 to file an income tax return, but who have qualifying income in 2007,
