Tax Rebate or Tax Advance ??

[ChuffDaddy]

No checks to anyone (who qualifies) who had direct debit/deposit of their current (2007) tax refund of payment - the "rebate" "premature refund" or whatever else you want to call it will just be a deposit to your account. What happens in 2009 when you file your 2008 taxes is IMHO unknown now although it is interesting to read all of the possibilities as mentioned here.

Well, we do know this. Barring any changes to the tax law between now and the end of the year, if your income and deductuions are substantially the same as last year's, you will pay about the same amount in federal income taxes. Plus, you will be getting a nice little check sometime this year--an advance credit--to spend or save as you see fit. This will effectively lower your tax bill for 2008.

 

[youbet]

Thanks ChuffDaddy and myself!

 

[TromboneAl]

Here is actual text:

Search Results - THOMAS (Library of Congress)

or

guywong.com: Full text of final Stimulus Package, H.R. 5140

(a) In General- In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by subtitle A for the first taxable year beginning in 2008 an amount equal to the lesser of--

`(1) net income tax liability, or

`(2) $600 ($1,200 in the case of a joint return).

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(2) TAXPAYER DESCRIBED- A taxpayer is described in this paragraph if the taxpayer--

`(A) has qualifying income of at least $3,000, or

`(B) has--

`(i) net income tax liability which is greater than zero, and

`(ii) gross income which is greater than the sum of the basic standard deduction plus the exemption amount (twice the exemption amount in the case of a joint return).

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(d) Limitation Based on Adjusted Gross Income- The amount of the credit allowed by subsection (a) (determined without regard to this subsection and subsection (f)) shall be reduced (but not below zero) by 5 percent of so much of the taxpayer's adjusted gross income as exceeds $75,000 ($150,000 in the case of a joint return).

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(1) QUALIFYING INCOME- The term `qualifying income' means--

`(A) earned income,

`(B) social security benefits (within the meaning of section 86(d)), and

`(C) any compensation or pension received under chapter 11, chapter 13, or chapter 15 of title 38, United States Code.

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(4) EARNED INCOME- The term `earned income' has the meaning set forth in section 32(c)(2) except that--

`(A) subclause (II) of subparagraph (B)(vi) thereof shall be applied by substituting `January 1, 2009' for `January 1, 2008', and

`(B) such term shall no

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(1) IN GENERAL- In the case of a taxpayer described in paragraph (2)--

`(A) the amount determined under subsection (a) shall not be less than $300 ($600 in the case of a joint return), and

`(B) the amount determined under subsection (a) (after the application of subparagraph (A)) shall be increased by the product of $300 multiplied by the number of qualifying children (within the meaning of section 24(c)) of the taxpayer.

 

[OAG]

Here is some information from the "horse's Mouth": Information on Stimulus Package

 

[ExHermit]

Two chances to qualify for rebate

Note that you have two chances to qualify for the rebate/credit. If you qualify based on your 2007 tax return, you get the "refund". If you do not qualify based on your 2007 return, but qualify based on your 2008 return, you get to take a credit against your 2008 taxes.

This is implied in the language on the actual law. Search Results - THOMAS (Library of Congress)
The law's language is, like most of the tax law, only vaguely related to English.

Here it is in something a bit closer to English.
http://www.house.gov/jct/x-16-08.pdf

"Rebate checks

Most taxpayers will receive this credit in the form of a check issued by the Department of the Treasury. The amount of the payment will be computed in the same manner as the credit, except that it will be done on the basis of tax returns filed for 2007 (instead of 2008. It is anticipated that the Department of the Treasury will make every effort to issue all payments as rapidly as possible to taxpayers who timely file their 2007 tax returns. (Taxpayers who file late or pursuant to extensions will receive their payments later.)

Taxpayers will reconcile the amount of the credit with the payment they receive in the following manner. They will complete a worksheet calculating the amount of the credit based on their 2008 income tax return. They will then subtract from the credit the amount of the payment they received in 2008. For many taxpayers, these two amounts will be the same. If, however, the result is a positive number (because, for example, the taxpayer paid no tax in 2007 but is paying tax in 2008, the taxpayer may claim that amount as a refundable credit against 2008 tax liability. If, however, the result is negative (because, for example, the taxpayer paid tax in 2007 but owes no tax for 2008, the taxpayer is not required to repay that amount to the Treasury. Otherwise, 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."