On February 13, 2008, President George W. Bush signed off on the $160 billion Economic Stimulus Package that Congress passed on Feb. 8. More than 130 million taxpayers will receive a rebate check with a goal of encouraging citizens to spend money to boost America’s hobbling economy.
Those who qualify must have at least $3,000 in income to receive the minimum rebate of $300 for an individual or $600 for a couple filing jointly. An individual can get up to $600. A married couple filing jointly can get up to $1,200. Parents, whether single or married, can exceed those caps if they have children, because they get $300 for each child.
The child must be younger than 17 years of age at the end of last year and live with a parent for more than half the year.
The rebate checks begin to be reduced once adjusted gross income reaches $75,000 for an individual and $150,000 for a couple. The rebate is reduced by five cents for every dollar a person makes over those thresholds. The plan is designed to get money in the hands of low to middle income Americans.
The Internal Revenue Service (IRS) states that “a person or couple must file a 2007 tax return to be eligible.” The IRS uses this to determine eligibility and calculate the size of the rebate.
The amount of the tax rebate will be based on a person’s 2007 federal income tax return’s Adjusted Gross Income (AGI), which is not just your annual salary; it also includes: wages, tips, interest, alimony paid to a person, and dividends, offset by any specific business, or capital gains or losses.
The checks will be mailed out to citizens at the beginning of May. Rebates will be disbursed based upon the last two digits of a person’s Social Security number. The earliest checks will be received by those who used direct deposit when filing their 2007 tax returns. Those who don’t use direct deposit will start receiving paper checks the second week of May.
All checks should be sent out and received by the end of July.
The IRS states that “20 million people aren’t required to file a return because they earn too little, but those people still must file to obtain the rebate.” The IRS is encouraging veterans and Social Security beneficiaries who usually don’t file returns to file a 1040A form and write on the top “Stimulus Payment.”
Tyrone Mayor James Kilmartin said he has mixed feelings about the economic stimulus checks and whether or not it will boost the local and national economy. He thinks that some people will use the extra cash for spending, to pay off debts or perhaps save the money.
“People are going to do what’s top on their priority lists,” said Kilmartin. “It’s a help, whether larger in the economy or personal, to boost people’s situations. Hopefully, it’s an impact on the low and middle working class trying to make ends meet. It’s probably not a big deal to the rich.”
Kilmartin, who is married and has four young children, hopes to use the extra money his family will receive to go on vacation and maybe do some renovations on his home.
Bellwood residents Tim and Kerry Sickler, who both manage the Bull Pen Restaurant and Lounge in Tyrone, have two sons – Talon, age 17, and Tage, age 11. The hard working couple qualify for the rebate check and have a few ideas of what they want to do with the extra money they will receive.
“Basically, we’re going to be paying off windows and siding,” said Kerry. The Sickler’s recently made some improvements on their Second Street home in Bellwood.
Tim mentioned that his family would like to be able to save some of the money to use for a vacation to Rochester, New Hampshire, where his oldest son was born.
Tyrone Borough employees, Karl and Kim Gurekovich, plan on putting their economic stimulus checks into their savings account for a rainy day, and possibly for a vacation or make home improvements. Karl has three daughters who are all out of high school that the couple can’t claim for added money in their rebate, but all three daughters are eligible for their own rebate checks.
Kara Jacobs, a 26-year-old who manages Tyrone’s Choice Store, is going to use her rebate check to pay her gas bill. She said her gas bill is high, and thinks a lot of people will use their checks to pay bills.
“I don’t think people will buy stuff with it,” said Jacobs, who travels from Johnstown to Tyrone every day for work.
“I have to make a lot of adjustments (because of gas prices),” she added. “I take from one to give to another. I spend almost $150 a week for gas.”
Jacobs is single with no children.
Theo Weaver, who is originally from Tyrone, is a 22-year-old single father of a two-month old son. He is presently in court over a custody battle for his son, and wants to use the extra money he will receive with the rebate to buy the things he needs in order to support his son if he gains custody.
“I want to get the essentials I need for my son to be able to live with me,” said Weaver.
Whether or not the economic stimulus plan boosts the local or national economy, it will help people in one way or another. Money will go back into the economy, but will it make enough of an impact to save the U.S from a recession?
If a person discovers too late that he or she should have filed a 2007 return to obtain the rebate, it can be done next year and still receive the money.
The IRS plans to set up a system where people can check online to find out when the rebate will be received, similar to how people now can track a typical refund online.
