The 2008 Tax Rebate is Official

Earlier this month, President Bush had proposed an economic stimulus package that would include a tax rebate for many Americans. This proposal has finally made its way through the system and will be signed by the President next week.

To be eligible for a full rebate, single tax filers must have 2007 adjusted gross income below $75,000 and joint filers must have AGI below $150,000. In addition, parents will also receive $300 rebates per dependent child, and there is no cap on the number of children eligible.

If you fall above the income limits, you may still be entitled to a portion of the rebate. There is a 5% phaseout on incomes above the $75,000 and $150,000 limits. Essentially, this means that you will have to deduct five cents from the rebate for each dollar above the income limit. For example: a single filer with an AGI of $80,000 would receive a rebate of $350 ($80,000 - $75,000 = $5,000 x 0.05 = $250 rebate reduction).

I also had a poll asking readers what they planned on doing with their rebate. The poll is still open, so feel free to voice your opinion. It is interesting to see that the majority of voters so far do not plan on spending their rebate, but instead will save or apply it towards debt.