US starts sending out tax rebates
"Starting Monday, the effects of the stimulus will begin to reach millions of households across our country," Bush said Friday in remarks on the South Lawn of the White House.
Those first rebates will be directly deposited into people's bank accounts. The Internal Revenue Service had been saying direct deposits wouldn't start until next Friday. Bush said paper checks would begin going out on May 9, a week earlier than previously announced.
"The money is going to help Americans offset the high prices we're seeing at the gas pump, the grocery store, and also give our economy a boost to help us pull out of this economic slowdown," Bush said.
Democrats said they were glad the rebate checks were about to go out, but suggested that multinational oil companies were not among the businesses the stimulus package was originally designed to help.
Bush's emphasis on fuel and food prices differed from other comments he's made since signing the economic stimulus legislation, intended to aid the economy by boosting overall consumer spending — which accounts for roughly two-thirds of the nation's economic activity.
Bush has suggested the rebates could trigger a spending spree. "When the money reaches the American people, we expect they will use it to boost consumer spending," he said last month.
By saying expressly that people could use these one-time checks to pay for such necessities as food and gas, Bush underscored the deepening challenges facing the economy.
CNN has details on who is eligible for the rebate - and how to receive it.
One-time payments will be sent to at least 117 million low- and middle-income households, 20 million senior citizens living off of Social Security and 250,000 disabled veterans.
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 per child under 17; there is no cap on the number of qualifying children eligible.
Tax filers who do not owe income taxes, 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.
The stimulus allows for a 5% phaseout rate for households above the income caps of $75,000 for single filers and $150,000 for joint filers. The rebates of those taxpayers will be reduced by the amount of income above the cap multiplied by 5%.
In the meantime, retailers have got their eyes on consumers' extra cash and are offering rewards for rebates.
Staples used promotions to urge small business owners to spend their rebates. Until May 4, it was offering $50 off purchases of $500 or more.
Home Depot urged customers to use rebates to invest in the environment and cut energy bills, offering discounts through July on compact fluorescent light bulbs and Energy Star appliances.
Wal-Mart and Best Buy also had plans in the works in hopes of getting people to spend their rebates.
Have you received a rebate? If so - will you be spending or saving?