Consumer confidence is at a 26-year low. Gas prices have risen yet again. Are we ready for some good news?
Here it is: Those tax rebates began showing up in bank accounts today, four days early. For those who didn't select direct deposit on their tax returns, the checks will begin hitting the mail May 9, a full week ahead of schedule.
"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," President Bush said Friday.
About 7.7 million payments will be deposited this week, as many as 800,000 today, according to the IRS. About 1.6 million more will go out Tuesday and Wednesday.
All told, about 130 million taxpayers will receive rebates.
What can you expect? Most individuals will receive $600, married couples who file jointly will get $1,200, and dependent children are good for another $300 each. This is an advance on a tax credit people would have gotten next year. You won't owe taxes on it, and, contrary to what many people think, you won't have to pay it back.
Rebate distributions will be staggered between now and July for those who filed tax returns by the April 15 deadline. Those who filed for an extension will get checks as well, the IRS, but they'll face a delay of about two weeks.
Whether you plan to save it -- a good idea given the economic downturn -- invest it, spend it to cover rising food and fuel costs, or take advantage of retailers' special rebate offers, consider it a gift from Uncle Sam.
Politicians hope the checks, part of a $168 billion economic-stimulus package, will boost consumer spending, the backbone of the U.S. economy. But taxpayers have other plans. An informal MSN Money poll of 100,000-plus readers found two-thirds planned to save it or pay bills.
When you'll get your checkThe exact date you receive a stimulus check will depend largely on the last two digits of your Social Security number.
If you expect a tax refund and chose to directly deposit it into two or three separate accounts, the IRS will send your stimulus check in the mail. (To have your refund sent to more than one account requires you fill out Form 8888. See this IRS page for more information.)
If you have a past-due federal or state income-tax bill or some other type of past-due federal debt such as student loans or child support, your stimulus payment likely will be reduced by what you owe.
An entire revised timetable for rebate distribution wasn't available, so some of the following dates could be moved up.
|Rebate delivery schedule|
|Direct-deposit payment||All sent by May 2|
|If the last two digits of your Social Security number are:||Your tax rebate check should be in the mail by:|
There may be exceptions, the IRS warned. "A small percentage of tax returns will require additional time to process and to compute a stimulus payment amount. For these returns, stimulus payments may not be issued in accordance with the schedule above, even if the tax return was processed by April 15," the IRS said.
"We have some returns that require a second look, that require us to pull them out of the processing for some reason or another," IRS spokesman Anthony Burke said. "It may not be that there's anything wrong with the return."
The "vast majority of people" will receive stimulus payments according to the posted schedule, Burke said, "but it's a big system, a lot of returns go through our pipeline," so some returns may not go exactly according to schedule.