If you qualify for the tax rebate, here's what you can expect from the rebate program.
- Taxpayers who file single, married and filing separately, or head of household: $600
- Taxpayers who are married and filing jointly: $1,200
- Low-income workers who normally don't file a federal tax return: $300 ($600 if married and filing jointly)
- For each child under 17 (as of December 31, 2007) whom you claim as a dependent: $300
As mentioned previously, if you have an AGI over $75,000 (if you file single, married and filing separately, or head of household) or $150,000 (married and filing jointly), your rebate will be reduced by 5 percent of the amount over the limit.
For example, if you're a single woman sans children with an income of $78,000, your tax rebate will be reduced by 5% of $3,000 ($78,000 - $75,000 = $3,000).
0.05 x $3,000 = $150
Your filing status would put your rebate at $600, and your reduction is $150, so:
$600 - $150 = $450 rebate
For a jointly filed return (eligible for a $1,200 rebate) with an income of $170,000:
$170,000 - $150,000 = $20,000
0.05 x $20,000 = $1,000
$1,200 - $1,000 = $200 rebate
If the couple has three eligible dependent children, they would receive a bonus of $300 per child, for a total of $900. Their $200 rebate would jump up to $1,100.
So, if you have a single income of $87,000 or a joint income of $174,000, your rebate has fallen to $0, unless you have eligible child dependents.
If you owe taxes this year, or if you're paying taxes on an installment agreement, consider the rebate a discount on your taxes. The IRS will automatically apply your rebate to any outstanding tax liability you might have. In some cases, the IRS may also apply your rebate to other federal debt, such as student loans or child alimony. Visit the IRS website for more information.
To find out when you're going to get paid, read on so you can plan your purchases.