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The rebate checks are coming! The rebate checks are coming!

As a result of the Tax Relief Act of 2001 many taxpayers will be receiving tax rebate checks. Congress has ordered the U.S. Treasury to send taxpayers lump-sum rebate checks by Oct. 1, 2001. The rebate reflects a new 10 percent tax rate bracket, 5 percent lower than the old 15 percent minimum tax. The new law creates a 10 percent tax bracket for taxable income as follows:

ü First $6,000 of taxable income for singles
ü First $10,000 of taxable income for heads of household
ü First $12,000 of taxable income for married filing Joint

Rebate checks in amounts up to:

ü $300 if you are single
ü $500 if you are head of household
ü $600 if you are married filing joint

Who gets checks?
While many taxpayers will receive the maximum rebate, not everyone will receive a rebate check. The IRS will be notifying taxpayers by letter in July, stating the amount of the payment you will receive, when the check will be sent, and if the rebate due will be used to offset an existing tax liability. Millions will receive smaller rebate checks because their 2000 taxable income was smaller than the amounts outlined ($6,000 on single return, $10,000 on head of household and $12,000 on a joint return). Those with smaller taxable income will receive checks equal to 5 percent of their taxable income (the difference between the old 15 percent tax and the new 10 percent).

The U.S. Treasury is basing the amount of the rebate on the income reported on your 2000 income tax return. If you didn’t have enough taxable income in 2000 to qualify for the full rebate, you will be able to claim a credit for what you are due based on your 2001 income when your 2001 tax return is filed.

If you had no income tax liability, you will not be receiving a rebate check.

When will you get yours? 
The IRS’s scheduled mailing plan is based on the last two digits of the taxpayers Social Security number:

Social Security numbers ending:
Should receive check week of:
00-09
July 23
10-19
July 30
20-29
Aug. 6
30-39
Aug. 13
40-49
Aug. 20
50-59
Aug. 27
60-69
Sept. 3
70-79
Sept. 10
80-89
Sept. 17
90-99

Sept. 24

Note: This schedule is based on tax returns filed by April 15, 2001. Taxpayers who filed extensions must file their tax returns by the extension due date to receive their checks before the end of the year, according to the U.S. Treasury.

Taxpayers who have moved since filing their 2000 income tax returns should file a change of address with the U.S. Postal Service so that the checks will be sent to the correct address.

This article has been presented by PBS Tax & Bookkeeping Service, a company that has been providing income tax and bookkeeping services to the trucking industry for more than a quarter century. Contributions to this article were made by Shasta May, Director Business Development for PBS. If you would like further information, please contact us at 1-800-697-5153. See our web site at www.pbstax.com.

Everyone’s financial situation is different. This article does not give and is not intended to give specific accounting and/or tax advice. Please consult with your own tax or accounting professional.

July Digital Edition