It looks like we're gonna get it

[Tom Slick]

new washer and dryer, the old ones have just about had it.

[LinuxRandal]

It's supposed to be a rebate against your 2007 taxes. I think they keep saying it will come in May.


As Loring has pointed out, we're "supposed" to spend it. Not that it's a bad thing to add to savings! But sepending it is what stimulates the economy.

JR

Now what about those of us who A: Our spending habits haven't really decreased, but increased due in part to bargains and more working? B: Have a USE to spend it on (the local Wood supplier), but no current storage for a project that is months down the road? C: have friends who would be harassing to use it for some adult forms of entertainment (aka, let's go to the boat) D: Have been somewhat depleting savings, to help boost the local economy, already.

[LCHIEN]

Why would you like to [h]ear someone ask "Why did it take so long to make it?"

Ed

you tell her "because I don't have the right tools..."

[Ed62]

you tell her "because I don't have the right tools..."

Doesn't work any longer. She's heard it before.

Ed

[Grandpasteve]

Tax rebate

Pay local taxes and buy a new hot water heater.

[Mrs. Wallnut]

Any ideas on where a fella could blow $600 on a muzzle for a mid 30's female spouse, to be applied on Sat. and Sun. mornings whereupon sawdust needs makin? I searched the jigs section to no avail....

I sure hope that you don't let your spouse read this forum because after your spouse reading that you may need to use that $600 to pay part of the hospital bill.

[Mrs. Wallnut]

Okay just out of curiosity that I ask this and the fact that I can't remember how much they are giving people back. What are the amounts they are sending out to people? I am just curious and out of touch on some things.

[Anna]

Okay just out of curiosity that I ask this and the fact that I can't remember how much they are giving people back. What are the amounts they are sending out to people? I am just curious and out of touch on some things.

I think it's $600 for individuals earning up to $75k and $1200 for couples earning up to $150k. The amount starts to phase out after that.

Oh, and $300 for seniors and veterans. I believe this "rebate" is only available to those who file a tax return (except the seniors and veterans, whose names are provided by SSA and some other government agencies).

I've always told my husband that shopping is my patriotic duty and that I'm just helping the economy. It feels good to be validated by no less than Congress and the President of the United States.

[gad5264]

I plan on stocking up on clamps

[Greg.B]

Bills, Bills, Bills...both my income tax refund and rebate will be going toward outstanding debt...I guess the good news is that I will be out of the red after this year, which is looking up. Most of the bills is related to the finishing of the basement. It does take a huge monkey off my back.

[dkerfoot]

I am hoping that lots of people will use their rebates to buy the products I sell, which are mostly manufactured in Poland from Chinese components. This will allow me to expand and hire additional employees. It will also increase my B2B transactions, including shipping, supplies, and services.

I'll probably use my rebate to help offset the effect of the dollar plummeting against the Euro. This will allow me to order additional product, which will help the Polish economy, so that they can buy more US military equipment, as well as McDonald hamburgers made from Brazilian beef and Levi's jeans and Nike shoes made in Indonesia - all of which directly benefit the US Economy.

[BobSch]

I think it's $600 for individuals earning up to $75k and $1200 for couples earning up to $150k. The amount starts to phase out after that.

Oh, and $300 for seniors and veterans.

And $300 for each kidlet.

[JR]

This is not a rebate or refund, nor is it free money. It is a credit on the taxes you will file in 2009. Next year you will get back less of a refund because of the advance you are getting this year. So I will USE mine wisely by reducing the overall debt I owe now.

Thanks for the link, Daryl. She explains things pretty well, but I have problem with this: "To produce this cash, Congress created a one-time tax credit to reduce taxable income for most taxpayers this year." IMO, it's not a reduction of taxable income. It is a reduction in tax obligation.

I've tried to research the exact treatment, but there's not much good information available yet (it's not even law yet!). Your analysis is actually closer than the article you referenced, but I don't think it's fully accurate. Here's my analysis.

FWIW, the bill, HR 5140, calls this thing a rebate. In the analyses it is also refered to as a credit. In effect this "rebate" lowers your tax obligation for 2008, and you are paid that amount now. According tot the Congressional Budget Office, the government is taking on debt in order to accomplish this ($151.7B in FY2008). http://www.cbo.gov/ftpdocs/89xx/doc8973/hr5140pgo.pdf

Without getting into all the permutations, let's focus on a single taxpayer, Bob, earning taxable income of $74,000. Bob will receive a check, probably in May, 2008, in the amount of $600. His tax obligation for 2008 has been reduced by $600 and he has been given a check in that amount.

During 2008 Bob pays his taxes through payroll deductions, the way most of us do. His tax payments total, let's say, $10,000. When he fills out his 1040 for 2008, the tax table says his normal obligation was $9,000. But now Bob subtracts $600 (the amount of the rebate/credit), making his tax obligation $8,400. Normally he'd get a refund in the amount of $1,600 at this point ($10,000 paid minus $8,400 obligation). But, since he's already been given $600 of that amount, his refund will be $1,000, just as it would have been if there was no rebate. Some people, who normally get refunds every year, see this as some sort of underhanded accounting, and there are many blog entries to that effect.

What about those who would be required to pay additional money when they file their return? Let's say Bob's payroll deduction had been $8,000 on his taxable income of $74,000. The tax table says his obligation is $9,000, but it gets reduced to $8400 due to the rebate/credit, as above. This looks like Bob only owes $400, but he's already been give $600, so his check needs to $1,000, just like there was no rebate/credit.

The staff of the congressional joint committe on taxation issued this analysis on Feb. 7. http://www.house.gov/jct/x-16-08.pdf An important note in this document says:

"... the checks have no effect on tax returns filed for 2008; the amount is not includible in gross income and it does not otherwise reduce the amount of withholding."

Anybody want to take a shot at describing the acclerated depreciation part of this bill, aimed at businesses?

JR

[messmaker]

I just found the flight to Orlando I needed. LOML , her dimwit husband and his 2 beautiful little girls are going to see the MOUSE. I understand that a princess breakfast is in my future.

[jonmulzer]

Am I the only person that thinks it is borderline psychotic to be giving money away when the government is already over $9 TRILLION dollars in debt. And they are doing this to alleviate a pending recession that is brought upon by of all things excess amounts of debt owed by individuals? They are giving back money that they don't have, by borrowing it from the Chinese, to help out a problem that they helped cause, by letting people borrow themselves into bankruptcy, and the government itself is bankrupt. It absolutely boggles the mind. Giving $600 to people will not do anything to stimulate the economy. It is about 1.4% of per capita GDP, a drop in the bucket with a drought on the horizon.