The check's in the mail

Well, not really. Not until May, in fact. But the economic stimulus package is headed to President Bush's desk, and he will sign it.

You can view the full text of the bill in PDF form here, or in HTML form here (click the bottom link).

Comments

[Brian Foster]

And it figures the rebate check based on the 2007 tax year, so congratulations -- you get your $300 for your child.

And "net tax liability" is figured after application of credits, both refundable and nonrefundable (except for the child tax credit), so it's figured based on the bottom line of actual taxes you owe under the code, not the amount of tax you started out owing based on your taxable income.

Although --

I note that "net tax liability" is defined as the excess of your regular tax liability over "the credits allowed by part IV (other than section 24 and subpart C thereof) of subchapter A of chapter 1." Section 24 is the child tax credit, so subtract that out, that's fine. Here's the thing though -- income tax withholding from your regular paycheck is technically a "credit[] allowed by part IV . . . of subchapter A of chapter 1." Specifically, section 31 of subpart IV is what permits us to apply the amount withheld from our paychecks against our tax liability.

So technically, as written, that means anybody who ends up being owed a refund for 2007 doesn't get an advance rebate check, because the only way they could owe a refund is if their "net tax liability," as defined here, was less than zero.

I think it's clear that Congress' intent was to figure net tax liability based on non-refundable tax credits, like child/dependent care and Hope/Lifetime Learning, but not based on refundable tax credits, like the EITC and ACTC -- which, again, is how withholding is technically treated.

But who knows how it will all play out. We need some implementing regulations!

[Economically Depressed]

I'm rich, biatch!

[Brian Foster]

Regarding my theory that technically, the stimulus bill as properly interpreted sends nothing to people who are owed a tax refund in 2007 --

I misread the statute. In the parenthetical "other than section 24 and subpart C thereof," I carelessly read "subpart C thereof" to refer back to section 24, thus meaning "other than section 24 and section 24(c)."

That's a) redundant, since section 24(c) is already included in the reference to section 24; and b) wrong as a matter of code hierarchy, because subPART C must be a larger umbrella than subSECTION C.

In fact, the parenthetical is exempting section 24 -- the original child tax credit, found in subPART A of Part IV -- as well as the entirety of subPART C of Part IV -- which is all the refundable credits, including the credit for income tax withheld.

So, never mind. There's no need to engage in a purposive reading of this portion of the statute to ensure that people who owe taxes but are owed a refund still get their rebate checks. It's worded properly.

Similarly, my paragaph above that begins "I think it's clear," in fact states exactly waht the statute says -- net tax liability is tax owed minus nonrefundable credits. If you still have tax liability for 2007 at that point, and that liability exceeds $300/$600, then you get the higher amount, up to $600/$1200, in your rebate check. Even if you also have refundable credits (EITC, ACTC, income tax withholding) that wipe out the rest of your tax liability.

Thank you. Carry on. :)

[Brendan Loy]

Thanks goodness. Now I can sleep at night. ;)

(Well, actually, that's entirely up to Loyette...)

[Some guy]

Just paid my 2007 Taxes. I don't get any "rebate" cause I am "rich" (earned over 75,000). So I am probably actually funding these rebates, then, aren't I ?

Why should I not get an extra $600 ? How much you want to bet that I paid $600 and then some every pay period because I happen to earn above 75,000 ?

I guess I should stop whining since I'm such a rich and happy bastard and get back in the gruel line with the rest of us prisoners.

[David K.]

Well if you read the article you'd see that it depends on how much over $75,000 you are making. If you are a single filer with no dependents and you make less than $87,000 you'll get a partial rebate.

[Some guy]

Nope. Still no cigar. I think I'll just put my money in a bank account and buy somebody's house at a firesale price after they spent their stimulus check.

[Andrew]

Sure but can you get approved for a home loan? The willingness of banks to lend credit as they continue to sort out their subprime losses is the crux of the problem driving all the economic instability.

[CD]

Some guy: feel free to donate your money to me until you get under the threshold. I'll gladly take the extra salary and you can have the $600. Maybe you can buy some perspective with it.