Rebates: What You Need to Know

Lawmakers have given their final seal of approval to a $170 billion plan intended to spark the slowing economy.  The centerpiece?  Tax Rebates.

Questions abound about how the program will work, and officials at the Treasury Department and IRS are scurrying to work out the details, but for the time being, here are some answers based on currently available government information and experts’ analysis.

To be eligible for a full rebate, single tax filers must have 2007 adjusted gross income (AGI) below $75,000 and joint filers must have AGI below $150,000.

Single filers with AGI below $75,000 will get rebates of as much as $600. Couples with AGI below $150,000 will receive rebates of up to $1,200.

In addition, parents will also receive $300 rebates per dependent child; there is no cap on the number of children eligible.

Tax filers who don’t owe income taxes because of various credits and deductions but have at least $3,000 in income – which can include Social Security and disability payments – will get $300 rebates per person or $600 per couple.

Your rebate is a one-time tax cut – an advance on a credit you’ll receive on your 2008 return.

Treasury Secretary Henry Paulson has said the IRS will start sending out checks in early May.  Previously, he said it should take about 10 weeks to crank out all the checks.  In all likelihood then, you’ll see the money sometime between May and early July.

That assumes, of course, that you hit the IRS deadline and file by April 15.  If you’re a laggard and have to file for an extension, you’ll still get a check but it may not come until the end of the year – probably in time for Christmas shopping.