Monday, January 21, 2008

$800 help or hindrance?

On Friday President Bush released a press statement saying that he intended to give taxpayers a rebate of $800/individuals or $1600/married couple. This was in hopes of jump starting the economy, similar in nature to his previous tax rebates in 2001 where he refunded $300 and $600 to taxpayers. Bush also suggested making his temporary tax cuts permenant.

The checks he's suggesting would be mailed out in June potentially. He says they would be from eliminating the 10% tax bracket on the first $8000 of income or $16000 for married couples. Democrats say this should be given to all taxpayers including the 40% of payers who pay nothing because they don't make enough to pay any federal income taxes.

However economists are debating whether this rebates are effective. Will it really stimulate the economy? And prevent a recession? Or are we already in one?

What will you do with the money? I am not sure what we would do. I am guessing it's going to DH's tuition payments. Other than that I'm not sure we're going to spend it like the government hopes.

So I am not sure if it's really going to help the economy? Will people really blow it? Or will more people stash it because they are worried about their jobs? Or use it to just catch up on bills, since it feels like our incomes are not rising as quickly as inflation.


Anonymous said...

Wise people will stow it away. But most people will see it as hitting th e lottery.

Shelby said...

IF I qualify (didn't qualify for the last one), it's going in the bank, to help with the move. If for some reason the checks get cut afterwards, it's getting sent to the next target debt.

Jim ~ said...

I think you're stats are off a bit. All this will be is more of our own money coming back. If you're in a lower tax bracket or don't pay any taxes, you won't qualify. I didn't qualify for the last one being a broke college student. This one will be interesting to see if it happens and how soon it could happen. My cost of living increase has only been 3% while inflation is 4% so I will never catch up. Paying 10%+ in interest on a credit card is even worse though.

Living Almost Large said...

I forgot to mention if your AGI is over $100k you may not qualify. I guess I might not either. But it's supposed to be for a narrow group of people I guess.