Tax Rebate is Yours, Even If You Didn't Earn It
Rather than taking the time to scrutinize every taxpayer's withholdings to date to find out who actually qualifies for the impending tax rebate, the IRS will send rebate checks of $300 to $600 to everyone who paid taxes in 2000 and filed their tax return on time.
If it turns out that some people who stopped working in 2001 receive rebates for taxes they didn't pay, well, these people can consider the money a gift from the federal government.
Analysts estimate that somewhere between 950,000 and 5 million people will receive undeserved rebate checks because they filed a tax return for 2000 and their 2001 income doesn't exceed $12,000. At $300 a check, that represents a cost to the government of $285 million and $1.5 billion.
Those who are orchestrating this nationwide tax rebate must feel the loss is worth the good feelings that the rebate program will foster. Lawmakers have mentioned that the potential loss of over a billion dollars is small change compared to the $8 billion in erroneous payments that were part of the Earned Income Credit program in 1997.
The Treasury Department is preparing a two-phase approach to the rebate program. First, a letter will be mailed in July to all taxpayers informing them of the program and advising them to watch for their checks. Then the actual checks will be sent later in the summer. It is projected that the checks will be mailed by September.
Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
Why is that, you might ask? My job is to replace the irreplaceable Gail Perry as Editor-in-Chief. What does that mean? I don’t really know! I think it’ll be fun getting a feel for things, throwing in my own thoughts here and there, and listening to the discussions you’re having about the accounting profession.