(Photo: Spencer Platt/ Getty Images)
Speaker of the House Nancy Pelosi, House Minority Leader John Boehner and Treasury Secretary Henry Paulson on Thursday announced a bipartisan deal on an economic stimulus package that would send rebate checks to most taxpayers in an attempt to keep the economy from falling into recession.
According to CNN Money, most single taxpayers would get $600 while most households with two incomes would receive double that amount. The deal includes an additional $300 per child and a total of 116 million taxpayers will receive checks of some amount. Higher-income taxpayers, those earning $75,000 or more or couples earning $150,000 or more, would get reduced rebate checks or none at all, depending on their income.
Paulson said it is possible that checks could start going out as quickly 60 days after legislation is enacted.
So what do you need to do to receive your check? Absolutely nothing, but since the IRS is currently in the middle of the 2007 tax-filing season, it could be late spring or even early summer before the agency can begin mailing checks.
UPDATE: I’ve heard conflicting reports concerning the impact of rebate checks on your return for next year. Some have said that this is merely an advance payment of your return. Others say that because the IRS is changing the tax tables, the refunds will be based on those and since the checks do not count as earned income, you do not need to report it on your ’08 return, which means it has no effect on your tax return or refund.
Concrete Loop will definitely keep you in the loop with this story as it develops and always remember, “there is no such thing as a free lunch.”
some of y’all aren’t looking at the full picture…
of course its a temporary fix for a larger problem, but they had to do SOMETHING or we would of been in another great depression. the past week the entire WORLD went into panic mode had it not been for the federal reserve as well as congress pulled some drastic measures..i never realize how much of an impact this country have with the rest of the world
they did the rebate in order to boost the economy….because we’re tanking! i understand most of y’all are living in paranoia and thinking there’s a catch to this, but if you watch the news lately, this is something that HAD to be done
now for it coming out of next year’s taxes (its not going to count for this years), i honestly don’t know. i know i didn’t file my surplus money back in 2001…obviously if they giving us money, then its obvious that we have to pay it back…
I’m sorry, but this is a short term plan for a long term problem. Trickle down effect hasn’t worked in about 70 years, and if I know I’m sure the gov’t has to be sure of it. Granted, it’s already passed, but the gov’t shouldn’t be so content with this plan, and should now focus on long term strategies and goals to repair the economy.
Wall St lost about 30 billion dollars last week with just 4 major companies losing quaterly earnings and the lost of thousands of jobs. What about the “working poor” who contribute to the economy. With this stimulus, you only get a rebate if you made at least $3k last year…a lot of people didn’t make that much last year, believe it or not.
Anyway, I’m not a fan…
thats wassup,its alot of low income families in need of not only their tax returns but the rebate check too…so it will be cool that they will have some other funds comin in to add to what their already getting………….
i have alot of fam that will appreciate this.
extra money for bills
I doubt that this tax money is going to avoid a great depression. It’s already a recession, even if they don’t want to call it one. There won’t be any relief until we get a new president. WHICH IS WHY, my vote goes to Hillary. I have nothing against Obama, but I don’t have time to see if he can show and prove once he gets into office. He’s talking a good game but I know for a fact that Hillary can get the job done, if for no other reason than she has the benefit of Bill on her side.
Oh boy. Here we go.
They can find money to help bail out a failing healthcare system out of bankruptcy or create poverty programs which keep babies and 10 year old off the streets but they can find money to “stimulate the economy”. This will eventually hurt us more than help us in the long run. For the most part, people who have a mindset to spend, spend, spend will continue to do so and this sort of thing does not encourage people to save for their retirement. That’s why millions of Americans (specifically the Xers and Yers) won’t have a pot to pee in when they reach their majority.
It’s almost like the gov’t takes people for fools (which a lot are). But what’s worse is that a lot of people will fall into this trap and develop the mindset that the gov’t will bail us out everytime there’s an economic crisis at hand. Not so because the gov’t is a co-conspirator in part to this mess. The economic downturn that we’re facing was created intentionally by mortgage companies and other financial institutions that systematically attempted to keep the poor poor. That’s no secret. Look at who is most affected. Do people really believe that the gov’t, banks and lenders didn’t see the subprime mortgage mess coming?
I hope people have the good sense to take this money and do something useful with it. Buying a 35-inch flat screen may stimulate the economy but what good is it when you’re 65 and can’t afford to heat your home? Oh yeah, and like someone else said, this is a rouse. You will be taxed on the following year for this same “free money.”
i’m gettin some money? always good news!
@17. Great Advice! One of the things the government repeatedly emphasized was “getting the money in the hands of the people who would spend it quickly” . I guess that means poor people. They are probably banking on the people with no money management skills to go out and by that new HD TV.
@18,
I think you have misunderstood exactly why the rich pay so little in taxes. I’m a corporate finance/corporate tax attorney.
Warren Buffet does not earn a paycheck. He is an investor. His income is primarily from his investment holdings. When you are an investor, you are taxed on a “capital gains” rate. This rate is not very high. As an investor, rather than an employee, you also have much more flexibility in terms of arranging your investments so that you have low tax liability.
However, people who earn a lot as EMPLOYEES, do pay taxes and do take quite a tax hit. To be honest with you, as a person stated earlier, I am a 6 figure earner, and I get hit VERY HARD with taxes, and I never expect to get a tax return.
Contrast that to a person who can be on public assistance for 9 months, work a low paying job for 3 months, and pull in a $5000 earned income tax return and you will see (I hope) why people who earn a good income feel that they are shouldering more than their fair share of the burden.
I can tell you this, my yearly income tax hit WITHOUT aggressive planning (what they take from my check and or what I owe) is more than what many people earn in a year. That is a significant chunk of change.
But when I was in private practice, I could be a little more creative with my income.
So when the press tells you that “the wealthy pay less taxes”, they are talking about the REAL wealthy, the EXTREMELY wealthy, the upper echelon of wealthy..like Buffet and Gates. Not the person in your neighborhood who works everyday and earns a nice check. Those people are getting hit hard and it is not necessarily fair.
@46..see my post above and AMEN!
66. ms_mac
Preach Sister!!!
I hope everyone uses the funds to inject some “wealth” into their lives. Invest, Be productive. Let’s not JUST be blind consumers anymore y’all. Good Luck with that.
My mom was telling me she remember getting some money back and then having to pay it back, so as much as I want to pay my credit card off I’ll just keep paying them chunks at a time and put that rebate in a cd untill they ask for it back.
The IRS is the last person I want to owe money to.
Hmmm, nice thought but no thanks BUSH. Our government dosen’t care about us. From going into debt for getting an education to taking care of our families. Washingtion, congress, etc don’t give a damn about how AMERICA lives. They collect their billion dollar checks and keep on moving.
I just wonder who would get the money first? Also, I was wondering if the govt would try to put restirctions on what the money could be used for. If this money is supposed to be used to stimulate the economy, what happens if people take the money, use it for down payments on cars, houses, boats, rims, ect… and then when the money is gone, wont things go back to what they are now… meaning the govt will be trying to come up with another plan later? There just sounds like a catch ((( reminds me of the old saying, “nothing in life is certain but death and taxes))).
Thank you for saying this #69.
This is absolutely silly…so b/c you make over a certain amount ($75K) you don’t need relief. Trust me making $75 and upwards to a bit over 100K and living in NYC is not rich or upper middle class. As for as I’m concerned I pay a hell of alot of taxes. Every year I have to sit with a financial adviser and figure out some creative way to invest or save $$ so more is not taken out for taxes. I’m not sure why anyone making $30K feel they are more entitled to getting some damn rebate check more than anyone else. Shouldn’t we all strive to make more money and increase our wealth???
#25 & 39 ya on point for sure! and if you are a really good thief lunch IS free-real talk
they didnt give these checks to rich ppl cause it would have went into the bank so why thru-out his 2 terms was he giving tax cuts to the rich- hmmph all those folks were doing was stuffing it into the bank. i believe we should give pres candidates psychiatric tests before they can become pres…just a thought
Show me the money.!!!………Bush better have my money
For the first time in American history, the United states government has started borrowing BILLIONS of dollars from the governments of China and Saudi Arabia to help prop up this ailing economy and to continue the wars in Iraq, Afghanistan and elsewhere.
Yes, the world’s wealthiest and most powerful nation is now a borrower and indebted to creditors! The first loans were taken out back in 2006 and since then the amount borrowed from foreign governments has grown astronomically.
Since we have spent over $2 TRILLION DOLLARS since Sept. 2001 to fight a so-called ‘War on Terror’, the government has effectively run out of money to finance any more domestic programs and projects and is heavily relying on the private sector, private equity firms and foreign investors (like Saudi Arabia, U.A.E and Japan who collectively own 10% of the U.S. economy) to save itself from this looming disaster! And what a disaster it could be!
This recession may be one of history’s worst.
And a $600 check ain’t gonna help much
just goggle “foreign companies buying american business”
@76 on point, filing a 1099 is a mutha without being aware of the latest deductions,I feel your pain.
It may be a set up for those who haven’t done taxes in yrs to get in the system….I’m just saying I know a lot of fools who hear ‘Free’ money but forgot to file for 2000,2001, etc….
Be wise!
Mlps & Chi Towns finest!
1. Bush being in the white house in the first place.
2. Gas, gas and more gas!These big ass trucks people want to have to show “big is everything” is just making it worse.
3. People who work here illegally because we know they work for low wages at any rate!
4. War in Iraq – Oh now someone “mislead” the president of weapons of mass destruction.Ray Charles know it wasn’t there so makes Bush think there was?Everyone knew there wasn’t (the need to talk to Korea).And I stated before , we been in a recession for a while it just catching up.I feel for the fools that even put BUSH in the house.Oh yeah because of his daddy and his experience.WOMP WOMP.
5. The super dooper rich who ain’t paying a damn thang.I guess “money ain’t a thang” now.
Bush know what he doing, leaving this country a mess before he say HASTA LUEGO!
Let’s see out real options:
A. take the money and give it back to oil companies
B. invest the money but get a low rate of return due to the lowering of the federal tax
C. spend the money on cheap made products made overseas
Either way we’re still in the hole….
Well for the folks making 75k and more a year that are struggling need to maybe read a book called “Rich Dad, Poor Dad”…. Spend/Save that 75k wisely and I doubt you’d have such hardships…. check out your assets v. liabilities…. just because you get a raise and make more money does not mean go out and run up higher credit card debt and buy extra large houses.
Purchase assets instead of liabilities.
I think one of the smartest things said on here was the person who said to take the money that you get and put it in a CD or something similar to accrue interest so if when you do have to claim it in 2008 you will have made money on it while still having the funds to compensate for the AGI increase.
@84HISBUTTERFLY
Unless you earn over $75000 a year or $150,000 a year, I think you have some nerve trying to tell people who do, what they should do with their money. Before my more recent income post law school, I have earned $20,000, 30,000, 50,000 etc.. WITH 4 CHILDREN so I know what that’s like. I don’t want to offend you, but your posts are offensive.Reading Rich Dad Poor Dad does not make you an expert in finance and certainly doesn’t qualify you to tell someone else what they SHOULD or SHOULDNT do with their money. I have Rich Dad Poor Dad, I’ve had it for two years now… Read it in one day….but it ireally is for people just starting out and learning about finance, not for people who have made their careers in it.
I am 34. I KNOW what it was like to struggle because I was a young mother with four children and a husband struggling to make it, worked my way through college and law school, I REMEMBER what that was like and so I am in no way knocking the people who earn less and count on tax refunds to make it. But I have also lived on the other end. A lot of black people have a misconception about how much $75,000-150,000 annually really is in actual money. It is nowhere near as much as you think. You have federal taxes, state taxes, local taxes, property taxes at a higher rate than other people and on top of that you have the same expenses as everyone else. If you have children (we have 6) you have the same child related expenses as everyone else.
I am extremely frugal. Probably obsessively so. I refuse to buy a benz although they are very pretty and on the surface, I could afford one. But I would have to sacrifice other things that are important to me–like college savings accounts and the trust fund contributions for our children. I drive a Chrysler Pacifica which seats my whole family, is cute, but I’m not spending my hard earned money to prove something to people who don’t pay my bills.
I love nice suits and consider them a career necessity so I buy them and I will go all out for a fly leather briefcase for court–but I don’t give old, Italian dudes my hard earned money just to have their name plastered on my belongings. I also don’t knock anyone who does. Their money is theirs, mine is mine. We focus on our children’s college savings plans, so that they can be in a better position than the one we found ourselves in when we started out.
That being said…
Back to Rich Dad Poor Dad… If you DID read it, however, you would understand that investing your AFTER TAX EMPLOYMENT INCOME does not mitigate your initial income tax liability. It will help you earn more money on the other end–if your investments do well, but the tax hit has already occurred.
I’m not going to post a sermon on the topic but I do want you to know that if you are advocating these things to people who actually earn that kind of money AND to people who make their careers in the field of finance, they know that you are talking about things that you don’t have knowledge of.
It is like this. You get a paycheck from your employer. Your income tax rate is set IN ADVANCE by government charts. You can manipulate your deductions to a certain extent, but the intial rate is set in stone. You can choose flexible spending accounts, dependent care accounts, college savings accounts, and health care plans on a pre-tax basis and those things will help to lower your reportable income, but the impact is limited. For instance, $5000 annually is the limit for a family to set aside for flexible spending. If you earn $100,000, $5000 is nothing to get happy about.
I’m not going to go on and on…and I’m a little fired up from just having come upstairs from my gym workout…but your post was the first thing I saw and I just thought “this person has some huge kahunas to try to chastise people about the reality of taxes. Especially since there is no way whatsoever to change your tax bracket if you are an employee. It is automatic.
Hmmm. previous post was a little long so here is the short of it. @84hisbutterfly
Put simply….from a tax planning perspective, you don’t know what the hell you are talking about. Period.
I respect other people’s opinions, but I don’t respect when people don’t know what they are talking about, and call themselves “educating” others about what they should do. That’s dangerous. If you need the long version—see that crazy,long post above….
#86 broke it down about people who earn higher wages. Money just does not go as far as it used to or as far as most people think it does. Bottom line, most people are hurting. We need a president who gives a damn and is not concerned with lining his own pockets.
the devil is in the details read the fine print bush thinks or maybe he don’t care what you people think. “this is a tax cut for his cronies” the ones who have made millions off this manufactured war and this man induced recession. alan greenspan did the same thing,a induced recssion when he was fed chair. and you gulliable colored folks can’t wait to get them crumbs of a tax rebate of a joke in the mail. you poor peoples mouth is running water for the m scraps while bush and his have and have-more people will get a tax break and get millions. they eat steak while you judas goats eat at ALDI’S. you gullible people.why oil is so high shit bush is a oil man him and the bush DY-NASTY.
@ Nefertari,
Dang sis, you schooled the hell out of these folks! Get ‘em girl! lol.
I appreciate your breakdown. A lot of people are under the impression that making low six figures is “rich”. Actually, nowadays it’s really just a hair above middle class (if that). To even consider yourself truly upper class means no debt, having savings, a well funded retirement account, etc. Plus, you really have to KEEP more than you’re giving back to the gov’t AND live comfortably while doing so.
Right now a billionaire is the “new” millionaire so people really have to think about how that translates over to the working class and poor.
@90 you are SO right! And I am not going to pretend that I always understood these things. Back when I was in school, struggling on $20 to $30k per year I thought $100,000 was a lot of money too!, until I actually made that much. For the first 4 months I spent like it was going out of style. Luckily though, I started to pay attention and realized “Whoa NEF!!! Whoa!! do the MATH.
You are SO RIGHT. If you don’t have a fat retirement account, aren’t debt free or at least have assets that outweigh your liabilities, you are just “making it”.
My goal is to earn enough money through my career and investments to retire and spend my time teaching black people about finance. It is not something that is easy to grasp if you haven’t gotten that knowledge as a child. I learned later in life but we teach our children so they will be prepared. I pay them an allowance just so that I can teach them how to save and spend.
It will get better for all of us as we learn more and choose better practices.
Thanks for the positive energy.
@81…I thought the exact same thing when I heard it. EXACTLY…but I know I’m a conspiracy theorist by nature so I pushed it out of my head.
Actually that was a “dumb down” break down since the majority of folks on here need to START learning .. hence Rich Dad, Poor Dad… Don’t try to act like the majority of black people are educated on finances. So I gave pretty good info for those that are not.
So, I will help educate my fellow black folks. Thanks.
@Hisbutterfly #93
I’m not knocking you for wanting to teach black people. That is admirable. But you do have to be certain that you know what you are talking about when you start advising people about their financial situation.
Sadly, but perhaps because of my tone, you missed my entire point. And again, you have made an “assumption” about the “majority” of people in here. You don’t see that it is offensive for you to tell us that the “majority” of people in here need to have things “dumbed down?
My post was not so much about the fact that yours was inaccurate and misinformed; I responded to you the way that I did because you stepped to the plate with a lot of cockiness and made a lot of presumptions that were offensive.
1. You assumed that if a person earns over $75,000 a year, but would still like to save money on taxes and get refunds and rebates like everyone else–they don’t know how to manage their money. That is a huge leap to make in assuming.
2. You assumed that everyone in here is like you–I don’t know, maybe you are single or have no children, or have no mortgage or have no student loans, or have no elderly parents etc., but your post pressuposed that if a person who makes over $75,000 wants more money, they must just be out trying to live the bling bling life and overextending credit.
3. Now here again, you assume that the majority of people in here need to have information “dumbed down” for them. That’s offensive. I think that most of the people in this group are intelligent.
4. You assumed that I think Rich Dad Poor Dad is a bad book…its not. It is a good book, but it had nothing at all to do with what either myself or NYCLady were referring to.
Finally, you assume that what Kiyosaki is teaching in his book is the end all fixer upper for all financial situations. It is not. It is a very good book and has great points, but it had absolutely nothing to do with what NYLady and I were talking about as it relates to taxes. There is a HUGE difference between the tax treatment of EARNED income and the treatment of CAPITAL income (Investments).
All of that being said. I’m not mad at ya at all. A little annoyed but I don’t hold onto things like that too long. Heck, that was 5 am. I’m damn near into tomorrow now. I move fast
the author of this post is right. there is no such thing as a free lunch. america is broke and this will be deficit spending that our grand children will pay for. i’m not interested in making any deals with the devil. i don’t run up my personal credit cards and expect my future grandkids to pay it off. this is wrong.
Nefertari
I believe Hisbutterfly23 is spot on. She captured the essence of Rich Dad Poor Dad perfectly. The aim is to teach your children to be the owner, not the worker. Most folk who own businesses understand implicitly how to get around taxes through loop holes. Your argument in this case regarding taxes is like comparing apples to oranges.
@96,
I respect your opinion. However, we were not debating the essence of Rich Dad Poor Dad. We were debating her assumption that people who earn over $75,000 per year make so much money, that if they are concerned with taxes then they must be going on spending sprees and not using good financial sense.
I agree that the two topics are apples and oranges, but it is Hisbutterfly who brought the mixed fruit into the conversation.
I defy you to find one reasonably well paid person, who is not concerned about taxes. You won’t. Because the more money that you earn, the harder you have to work to earn it. The harder you work to earn it, the more invested you are in RETAINING it.
In fact, the topic is taxes. I have no issue with her assessment of the book Rich Dad Poor Dad. I in fact stated that several times. I take issue with her “advising” people who were discussing the impact of taxes, that their REAL problem is that they don’t know how to manage their finances.
You are correct. The essence of Rich Dad Poor Dad is that investing and owning your own business is the best route for those who want to become wealthy AND mitigate their tax impact. I stated that much earlier in this line.
However, we were discussing people who earn income as employees and the unfairness of many tax statutes as it relates to those on the higher end of the scale.
@96 spot on is a British term are you from england?
This is nothing more than a political show
1:this is a PRE-bate. You will be taxed for this check next year.
2:It ADDs to inflation since the FED had to print up new bills.
as a result the price of gas,food,imported goods will ALL go up.
3. It doesnt cut spending which is whats needed to help the economy. Also import tariffs would go VERY far.
4. Like previously stated, this weakens the dollar further, and this sham of a plan is insulting to us with a little intelegence.
I guess the Reserves feel the need to sink the dollar faster in favor of the amero
Isn’t it strange that the government can cut checks to save the economy from a recession. But they can’t cut checks to better our schools. Don’t be stupid ppl. If you spend the money it goes right back to them and we still lose unless you own Nike stocks keep your money in your wallet.
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