The Summer Tax Rebate - How Will it Work?

The Jobs and Growth Tax Relief Reconciliation Act of 2003 provides for an increase in the Child Tax Credit from $600 to $1,000 per qualifying child. President Bush has authorized a rebate program whereby millions of taxpayers will receive their additional $400 of Child Tax Credit in the form of a rebate check to be mailed this summer. Here is how the program will work.

Who Qualifies?

Taxpayers who claimed the Child Tax Credit on their 2002 income tax returns and who listed at least one dependent who will be under age 17 as of December 31, 2003 qualify for the rebate. This rebate represents an advance payment of a portion of the 2003 Child Tax Credit.

You must have claimed a Child Tax Credit in 2002 to receive a rebate in 2003. If you didn't claim the Child Tax Credit in 2002 but qualify for the credit for 2003, see "What Happens if You Don't Receive a Rebate To Which You're Entitled?" below.

What Do You Have to Do to Get Your Check?

You don't have to take any action to get your check. The IRS will determine who qualifies and mail advance notices to all qualifying taxpayers. Shortly thereafter the checks will be mailed. If you think you qualify for the rebate all you have to do is wait to receive your check. If you are entitled to the Child Tax Credit but don't receive the rebate, see "What Happens if You Don't Receive a Rebate To Which You're Entitled?" below.

When Will the Checks be Mailed?

The checks will be mailed beginning on July 25 and in two subsequent mailings scheduled for August 1 and August 8. Notices will be mailed in advance of payments to advise taxpayers of their eligibility for this rebate program. Approximately 25 million checks will be mailed as part of this program. There will be no direct deposit service available for rebate payments.

Taxpayers who filed their 2002 income tax returns late are still eligible for the rebate, but their rebates will not be included in the first three mailings. Later mailings after August 8 will be for qualifying taxpayers who didn't file their 2002 tax return until after the April 15, 2003 due date.

What Happens if You Don't Receive a Rebate To Which You're Entitled?

If you do not receive a rebate but you are entitled to claim the Child Tax Credit for 2003, you should wait until you file your 2003 income tax return, then claim the full amount of the $1,000 Child Tax Credit on your tax return.

What Happens if You Receive More Rebate Than You're Entitled To?

If you receive a rebate that exceeds the amount of Child Tax Credit that you compute on your 2003 income tax return, you will not be required to repay the difference.

Note: Taxpayers who owe money to the federal government either for prior year tax returns or other debts are likely to have their rebate applied to this outstanding debt.


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