Consumerist
UPDATE: Stimulus Checks Will Not Cut Into Your Rebate
Those $600 rebate checks about to spew forth from the Treasury as part of a $168 billion economic stimulus plan are an advance on a 2008 tax credit. We explain how this works after the jump.
Who Is Eligible?
Anyone who files a 2007 tax return with an adjusted gross income between $3,000 and $87,000. The limits are twice as high for couples filing jointly. Since the rebate is tied to your tax return, your rebate will be delayed if you file for an extension, so get your documents in order by April 15.
How Much Is The Rebate Worth?
The rebate is initially worth $300, but rises to match the tax you owe up to $600. Couples filing jointly get twice as much, up to $1,200. The rebate's value decreases by $50 for every $1,000 earned above $75,000.
What Exactly Is Being Rebated?
Congress implemented a one-time tax cut for income earned in 2008. Rather than delay the benefit of that cut until you file your tax returns in 2009, Congress is giving you the money now.
What Happens If I'm Not Eligible This Year?
If you don't qualify now (either your AGI is below $3,000 or above $87,000,) but do qualify next year, you can still claim the credit when you file your returns for 2008. If you qualify this year, but not next year, congratulations, you win, enjoy your free money.
Great! What Should I Do With My Rebate?
The government wants you to immediately inject your rebate into the economy by buying all those delicious consumables we love to write about. Saving or paying back student loans is not what they have in mind.
How Will the Economic Stimulus Tax Rebate Affect 2008 Tax Returns? [Consumerism Commentary]
(Photo: EricGjerde)
Comments
I've already decided I'm going to blow through my 600.
Boston, here I come!
I'm confused, is this a good thing?
New HDTV. Yeah. That's it. Or not. Maybe replace the fence in the back yard. Or pay off a credit card. Or not. Then again, 135 bags of Cheetos is appealing.
My tricky dick fun bills are going towards 200 cups of coffee!
Wow, what a letdown. It goes from "free money" to "hey, we're sending you your rebate early!" but nobody's reporting on that. It's going to be a sad country come rebate time next year.
Well, since its not actually free money, just an advance on money they will owe me anyway...I'll put it in savings for my down payment on the Toyota Pious I want
I'll never see mine cause my wife will spirit it away before the check ever gets to me. If I did get it, I'd buy a couple of boxes of really nice cigars.
Well I've got news for em... I'm paying of the only debt I have, and its the leftovers of a student loan. Muhahahaha.
The government is going to hate this one, but I'm going to use it on my long-awaited trip to Europe, where I will need the extra money to combat such a ridiculous exchange rate. Do you think they would send me the money in euros? :)
Vegas baby, Vegas! Ehh, too bad I don't qualify.
I will be spending mine on illegal, non-taxable drugs mostly. :D
i know people have asked this before, but how in the world do you fold the bill like that?!
Part car repair. Part vacation.
Um, beer. Lots and lots of beer. Good beer. Tasty beer. Yum.
Two working adults and three kids... I'm all in for $2100. We're planning a family road trip cross-country this summer. Just what the government wants, spending it in dribs and drabs at tee-pee motels along Route 66.
I'm going to pay off some back taxes.
Yeah, I'm still on my quest to get debt free, so anything - even a cash advance on my rebate - is "found money" and goes straight towards the balance. No Prada bag for me, thanks.
I'm going to make a robot. A boy robot.
I haven;'t decided, but I will not spend it on consumables. There's a piece of land near my fiance's mom's place that I think I can pick up for the overdue taxes. Failing that, I'll probably pick up some silver coins.
I didn't understand any of that, any links to a simpler explanation? Is it a check that is getting sent out to past tax-filers, or is it a deduction/forgiveness for tax liability?
Paying off my wifes pre-marrige credit card dept here.
(I had student loans to pay for college... she had credit cards... and to think she is the smart one...)
Mine is going towards my moving back to Seattle from the Midwest. I plan to travel starting May 31st, so the return comes just in time! Will go right back into the economy, since moves are expensive!
Rent for one month.
I'm putting mine into a savings account as a big 'fuck you' to Bush and co.
I will give a quick thank you to the government.
However, I will be sending my check straight into the last of our credit card debt. Maybe I'll save 50 bucks and buy a Wii game.
Does this remind anyone else of a commercial where they have a $300 refund for signing up for a packaged service. They ask everyone what they would do with an extra $300 and everyone just starts spouting nonsense beginning with a seemingly stoned stereotype of a girl vacantly spouting "Some really awesome concert tickets" and capped by some frat boy yelling half-heartedly "HELLO MP3 PLAYER!". Ugh...
I'm blowing mine on drugs and gambling.
@DropBearCharlie: Forget the coffee, I want shiny pebbles, art, and junk parts of animals. On second thought maybe I'll buy turkey dogs for my friends.
@jurijuri: @legotech: You misunderstand. It is an advance on an ADDITIONAL credit.
Since I'm actually graduating in August, a chunk of it is going to a party. The rest - yep, you guessed it, student loans. My 2007 tax return will finish off the last of my credit card and medical debt.
Hmm, pretty sure I tried something similar before, I think it went like this:
Use this paycheck for next month's rent or to get drunk right now...?
Side note: I was bummed when it came time to pay the rent. By the government's logic, however, I was doing the right thing. Isn't it fun to be 18 and irresponsible, but also in charge of 400 million Americans?
Lyndyn is right. This is an extra credit for 2008 only. They're just writing you a check now.
Your taxes don't go up at all as a result of this credit.
"Saving or paying back student loans is not what they have in mind."
Not really true. Saving the rebate, by putting it into a bank or equity investments serves to boost the economy as well. Repaying debt to a lender makes that amount of capital available to others for business expansion, etc.
ROAD TRIP!!!
I don't want an advance on my 2008 "refund." Every year I have to do a major song and dance just to get a "refund." This will just make it that much harder. And if I did want to borrow money, it wouldn't be from the govt. So this will go into a money market account until I do our 2008 taxes, just in case I have to give it back.
60,000 penny gumballs!!!!
I will finally be starting my Roth IRA. WooHoo long-term savings!
I'm just glad this "minor" detail is finally getting out. I've been saying it from the beginning (as it's essentially the same crap BushCo pulled a few years ago), but everyone kept saying 'oh no, no..this is a bonus ON TOP of your tax refund.
Well, to all of those nay sayers, I say 'bite me.' This check goes right into savings, which is where next year's tax refund-a refund which will now be $1800 smaller-would have gone.
I am buying a little bit of gold.
@ideagirl:
It actually isn't an advance on your 2008 "refund". It is an advance on your 2008 tax credit that was just instituted. Rather than having you wait a year (until after the 2008 tax year), they are giving it to you now so it will benefit you and the economy sooner. Whether this will be enough to head off or minimize a potential recession, I don't really know.
I will be putting mine into my savings account, where it will either be used to pad my emergency account or to pay for a trip somewhere (probably from NY to FL to visit my family).
I won't have any debts left to pay off come the end of the month anyway, so the rebate will either be going into savings with the bulk of my paychecks or I'll get my truck fixed up or something.
ugh! So my idea of putting it in the bank was a good idea. Least I'll earn a tad bit of interest on it before tax time.
This isn't very good reporting...You've got 80% of the people in here thinking that the headline means people will get $600 less back (or owe $600 more) next year because of this, and that's just not the case. In fact, it works to most people's advantage.
I will put most of it into my retirement savings accounts and mutual funds. A tiny bit will go to buy yarn for knitting, perhaps the ultimate form of anti-consumerist entertainment (or at least it would be if I spun the yarn myself from fiber I grew or raised myself).
Would somebody please explain to me again how it helps the U.S. economy for everyone to go out and buy more stuff made in China.
I just started back at school this year, and had to take out loans. I may not have graduated yet, but I'm sure as hell going to start paying off my unsubsidized loan.
What's I'm not sure about is if I'm getting $300 or $600. I probably won't have to pay taxes this year (maybe about $50 or so, damn me for not saving enough of my 1099 work), so does that mean I get $300? (scratches head)
what a confusing post!this has nothing to do with 08 taxes except getting it into next years tax code..make everything fucking hard for gods sake...spend the money and shut up!!
It's going straight into my home repair and improvement fund. December was a bad month for things breaking, so it will be nice to toss this in there and get it back up to size faster.
Has Bush done ANYTHING good for America? I am really at a loss to think of one positive thing.
I just used my tax refund this year to pay off some vet bills, so I guess this credit will go into my savings...
I don't understand how giving us free money to waste on B.S consumer stuff or to help make a dent in mistake-debt or medical debt is really going to help the economy. wow, 600 dollars. spaying one cat and having the other treated for a mysterious ailment was 600 dollars. no 'consumer anything' there.
Screw the government! I'm going to save my money and pay off student loans!
If you don't qualify in 2007, but do qualify in 2008, you can still claim the credit when you file your return next year.
Interesting wording there. Definitely something to help improve the work force for next year. I don't qualify this year for takes (recent graduate with sub 3k income) but with an expectation for a job next year, this is encouraging.
I plan to secure a credit card with the $300 or $600, then after I make proper payments for 6 months I plan to a) apply for more cards and/or b) ask for a limit increase on the first card.
I will then run up the balances to past the limit and default on them.
TAKE THAT ECONOMIC STIMULUS PLAN, HERE IS A MICRO CC MELTDOWN.
Seriously though I'll probably use it to renew my insurance on my bike or some other mundane and boring thing.
paying off debt and setting some aside for an emergency slush fund.