Anyone else see this about tax rebates?

[vleisme]

[JollyGG]

Yes I did see this. What everyone seems to be missing is that while yes it is an advance on next years tax return. It is not money you would otherwise have had in that return. Because they did a one time elimination of the 0-10% tax bracket for this year to create the lower tax burden and the rebate. Therfore you will not be getting any smaller of a check next year than you would have. Or said another way, you won't owe any more taxes than you normally would.

Yes, had they done the one time elimation of this tax bracket and not sent the checks now you would have seen the money when you filed your return next year. And with the check you will not see it in the spring. But the money comes from a one time change in the way that the first 6000 we earn each year is taxed this year.

So basically if you owed $2000 in taxes last year. If nothing changed this year, no rebate checks happened, and no tax changes happened you would owe $2000 next year. Well what they did was eliminate the tax on the first $6000 you earn in the year. Meaning each of us will owe around $600 less in taxes for 2008, making our tax burden for 2008 $14000 instead of $2000. They are sending you that extra $600 now.

Or in terms of a tax return. Say you owe the same $2000 and you paid in $4000 in taxes for 2008. You would normally get a $2000 tax return. With the change in the tax bracket instead you would be entitled to a $2600 return, because your tax burden was lowered by $600. You will get $600 this summer, then you would still get the $2000 you were normally expecting next year.

[krielly]

Not missing this at all. I've been trying to get that point across myself but gave up

Regardless, it's not free money anyhow, as it will need to be paid back by our government at some point (probably by our children and grandchildren no less). But, as you have pointed out, it's not "reducing" our subsequent years return.

K

[Cali]

I didn't see it, but already knew it.