Approximately 117 million Americans will receive a tax rebate of $600 for individuals and up to $1200 for couples plus an additional $300 for each child. To qualify for the rebate you must have paid federal taxes in 2007 and have a valid social security number.
For individuals making over $75,000 and couples making over $150,000 the rebate will be reduced. If you owe back taxes the amount owed will be deducted from the rebate check. Americans who didn't earn enough to pay income tax but had an earned income of at least $3,000 would receive $300 for individuals and $600 for couples. Checks would be received 60 days after the legislation is finalized.
The government is hoping the checks with encourage Americans to spend their money to help jumpstart the economy. Unfortunately so many Americans are living paycheck to paycheck and are struggling to make end meets that for some the tax rebate check will not change their current financial situation. The focus of Americans is not let me go shopping, it is, "Where I am going to find enough money to go to work, pay for daycare, pay my mortgage"? The tax rebate money could results in responses like, "I needed this but I need more, a lot more."
Americans are losing their jobs almost monthly, companies are downsizing, the cost of gas is increasing, grocery prices are increasing while home prices are decreasing. Americans need long-term solutions. After the tax rebate is spent most Americans will be in the same financial situation as they were before receiving the tax rebate. Write your congressman and ask for a better solution to the recession.
Here are 5 tips to use your 2008 Bush tax rebate wisely.
1. Don't use the money to go shopping
2. Use the money to pay a debt or monthly expense
3. Open an emergency fund or savings account
4. Open an investment account
5. Buy basic necessities needed
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