OK. Can someone explain to me...

[Gee-Are]

This damned economic stimulus package that is on the table? I'm basically an idiot on this issue. First of all, I don't remember getting the first check in 2001. Secondly, they give everyone $600 and $300 for each kid, right? So those people who have been struggling to pay their bills and home mortgage, do that, and then what?

How has this stimulated the economy? All they've done is given tax cuts to the rich and indirectly put more money in their pockets, right? Am I seeing this incorrectly? Can somebody make it plain for me.


I'm serious...confused.

[BKupInHere]

Ghost theyre hoping that the rebate will encourage Americans to SPEND THAT MONEY and rejuvenate the economy

[Gee-Are]

yeah but $600? I can get a better rebate from a car dealership. And with the number of people that's been out of work and behind on bills, the money is only going to go BACK to the wealthy people who are lording over the American people with collections.

[BKupInHere]

True! But free $$ is money...if you dont want it...slide it over here!

About 2 weeks ago,marketwatch.com were stopping people and asking them what would they do with the rebate.

One of those people were ME...Im trying to find the clip,but they may have removed it

[Champs Elysees]

This Q&A breaks it down quite nicely. I'm still skeptical about the outcome, but whatever.

Pender: Economic stimulus package Q&AKathleen Pender

Tuesday, January 29, 2008

The White House and House leaders agreed to an economic stimulus plan last week that would provide about $100 billion in tax refunds, among other economic incentives.

It looked like the package was going to sail through Congress, but now some Senate leaders are hoping to modify the deal, creating some political intrigue in the process.

While that plays itself out, here are answers to some questions about the plan agreed to by the House and the White House.

Q: How much is the refund?

A: It depends on your income and tax liability, but it ranges from $300 to $600 for singles and from $600 to $1,200 for married couples filing jointly.

Anyone eligible for a refund would receive an additional $300 for each child 17 or younger who lived with them for more than half of 2007.

For example, a married couple with two children could receive up to $1,800. There is no limit on the number of children who could earn their parents a refund.

Our leaders hope that most people will immediately spend their refunds and stimulate the economy.

Q: Who is eligible for a refund?

A: A minimum of $3,000 in earned income in 2007 is required, even if no federal income tax was paid. Earned income means income from a job or self-employment. The refund phases out for higher-income taxpayers.

To get a refund, you must file a 2007 tax return, even if you don't owe tax, so the IRS can find you.

If you had no earned income but you paid taxes - perhaps on Social Security or pension benefits or investment income - you could receive a refund of your 2007 tax liability up to $600 (single) or $1,200 (married).

If you had no earned income and no tax liability in 2007, you would get no refund under the existing proposal. However, the Senate is trying to amend the bill so senior citizens living off Social Security could get a refund.

Q: At what income level does the refund phase out?

A: Singles with more than $75,000 in adjusted gross income and couples with more than $150,000 would lose some or all of their refund. (Adjusted gross income includes income from all sources; it is usually the biggest line on your tax return.)

For every $1,000 you earn over those limits, your refund is reduced by 5 percent multiplied by the amount you are over the limit.

A couple with no children earning more than $174,000 and a single with no children earning more than $87,000 would get zero refund. People with children could earn a bit more before their refund disappeared, depending on how many children they have. The Treasury Department has set up a Web page that gives various examples of different family situations. You can find it at links.sfgate.com/ZCGQ.

If you don't get a refund check because you earned too much, you won't get the benefit of the zero percent tax rate when you file your 2008 taxes either.

Q: When would we get checks?

A: In a press briefing last week, Treasury Secretary Henry Paulson first said that checks could start going out within 60 days of the law's enactment and that it would take about 10 weeks to send out the "lion's share."

However, due to the crush of tax returns that must be processed in early April, Paulson later said checks would probably start going out in May.

Q: How does this differ from the tax rebate we received from Uncle Sam in the middle of 2001?

A: In 2001, the maximum refund was $300 for singles and $600 for married couples filing jointly.

People who had earned income, but did not pay taxes, were not eligible.

And there was no phaseout for higher-income people in 2001.

Q: How big is the refund compared to 2001's?

A: About 117 million households would receive a total of roughly $100 billion. That amounts to about 0.7 percent of gross domestic product.

In 2001, about 89 million households received $38 billion - about 0.4 percent of GDP.

Q: Why are high-income households being excluded?

A: Nadeam Elshami, a spokesman for House Speaker Nancy Pelosi, said that "the president only wanted to give (refunds) to those paying income taxes. We thought it was critical to provide rebates to those families who may not be paying income taxes but who are paying Social Security, Medicare and other taxes."

To provide tax benefits to lower-income people and keep the stimulus package at $150 billion (including $50 billion in business tax credits), "you had to cap (refunds) at the top," Elshami says.

He said lawmakers also believe that lower-income people are more likely to spend their rebates than higher-income people.

Q: How effective are rebates, and are lower-income people more likely to spend them?

A: That's debatable. Two studies of the 2001 rebates produced different results.

University of Michigan economists Matthew Shapiro and Joel Slemrod based their study on a household survey conducted in the fall of 2001. Only 21.8 percent of those surveyed said they planned to spend their refund, 32 percent said they would save it and 46.3 percent said they would use it to pay off debt. A follow-up survey in 2002 yielded similar results.

In both surveys, "there is no indication that low-income households were more likely to spend the rebate - in fact, higher-income households were more likely to say that the tax rebate led them to mostly increase spending," the authors said.

Shapiro said it's hard to say whether the rebates were anti-recessionary because the Sept. 11 terrorist attacks occurred around the time they were going out.

Consumer spending collapsed in September after the attacks but rebounded in October, mainly because automakers started offering zero percent financing.

A separate study by David Johnson, Jonathan Parker and Nicholas Souleles concluded that "the rebates provided a substantial stimulus to the national economy in 2001, helping to end the recession."

Their study, based on the government's Consumer Expenditure Survey, found that households spent 20 to 40 percent of their rebates on nondurable goods during the three-month period in which their rebates arrived, and roughly two-thirds of their rebates cumulatively during this period and the subsequent three-month period.

Their study also found that "low-income households spent a much larger fraction of their rebate during the three-month period of receipt than the typical (middle-income) household." They added that "high-income households also seem to have spent a somewhat greater fraction of the rebate ... although this difference is not statistically significant.

Net Worth runs Tuesdays, Thursdays and Sundays. E-mail Kathleen Pender at [e-mail].

[BKupInHere]

ok here's the video...

Im on this twice...Im the four eyed black woman in the motocycle jacket (yeah,it was "dress down day"...if I'd known I was going to be on TV,I wouldve "divaed" out...LOL)

www.marketwatch.com/tvradio/bcPlayer.asp?bcpid=203719194&bclid=86272812&bctid=1381652051

<--is cuter than the video..for real

[Nupey]

bkupinhere said:

ok here's the video...

Im on this twice...Im the four eyed black woman in the motocycle jacket (yeah,it was "dress down day"...if I'd known I was going to be on TV,I wouldve "divaed" out...LOL)

www.marketwatch.com/tvradio/bcPlayer.asp?bcpid=203719194&bclid=86272812&bctid=1381652051

<--is cuter than the video..for real

....I'm sure...

[Nupey]

<-----Will smite himself for ^^^ that comment

[BKupInHere]

nupey said:

<-----Will smite himself for ^^^ that comment

No need to smite yourself Nupey,because Ive seen that video of you at the gas station and know you look better than that (because youve posted other pics)

<--exalts Nupey

[Nupey]

Lol @ Video's making people look lame....

<----Still smites himself

<---Exalts Bkup

[BKupInHere]

Nupey,I told them if they gave me 5 minutes I could ditch the "neo-soul crochet hat",take off my glasses and take off my jacket/hoodie...

they laughed @ me...LOL

as my mother said "always look your BEST,cuz you never know who's going to see you!

at least I sounded intelligent...

[Nupey]

I was under the impression that you lived in Brooklyn, not chicago

[BKupInHere]

nupey said:

I was under the impression that you lived in Brooklyn, not chicago

I work in Manhattan...they spoke to NYKers too...that was on Broadway,in the shadow of Ground Zero & near Wall Street!!!


<--not perping Brooklyn...LOL

[Nupey]

bkupinhere said:

nupey said:

I was under the impression that you lived in Brooklyn, not chicago

I work in Manhattan...they spoke to NYKers too...that was on Broadway,in the shadow of Ground Zero & near Wall Street!!!


<--not perping Brooklyn...LOL

So you Kuttin? Answer me in PM's

[No Screen Name]

Question: won't this rebate just create a BIGGER deficit? How is THAT a good thing?

[Puzzler]

z said:

Question: won't this rebate just create a BIGGER deficit? How is THAT a good thing?

That's what I was thinking.

[Cambist]

Nupe just said "kuttin" didn't he? LOL!!

[Warner Fite]

ghost said:

This damned economic stimulus package that is on the table? I'm basically an idiot on this issue. First of all, I don't remember getting the first check in 2001. Secondly, they give everyone $600 and $300 for each kid, right? So those people who have been struggling to pay their bills and home mortgage, do that, and then what?

How has this stimulated the economy? All they've done is given tax cuts to the rich and indirectly put more money in their pockets, right? Am I seeing this incorrectly? Can somebody make it plain for me.


I'm serious...confused.

Honestly, I didn't see the off-tax season rebate due to income declarations and bracket. But I think in fairness...just fairness, it is not much money given the cost of living in 40% of the country where it takes a combined income of $115K to afford a 400K house with kids to feed, life insurance to purchase, gas prices, poor job security......right, you're absolutely right.

But, if that money was rebated during the Clinton years where most Americans, and particulalrly where Black Americans are concerned, enjoyed a measurable rise in income and overall wealth, this would not be an issue...

The fact that we're in a certified recession fueled by the real estate market (The same cause of the '87 market sting and to a large extent, the 20's depression) growth outperforming the actual demand, makes little money even less...

But we shouldn't count that out. Those rebates and tax credits really need to be itemized and then utilized as a sort of savings, for either future education purposes...or retirement. I have four sons and despite our income, we get a good chunk. We put it away even though it could be help put me ahead in my mortgage.....and buy some extra Sam Adams and other important priorities.....I digress.

But you get my point....