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Congress Agrees To Stimulus Package That Puts Your Money Back Into Your Pocket

By Erik Folgate

Have you heard the news? The IRS is going to be sending YOU money this year, instead of you sending THEM money. But, there’s a catch. They’re just giving you back your own hard-earned money! Yes, it’s a nice gesture for Congress to send us some tax money back, but is it really going to stimulate the economy? I think all it’s going to do is stimulate the big-screen TV sector, but who knows.

Read this article to get the whole story about the stimulus package Congress is going to pass. Here are the highlights and lowlights of the bill:

  • Individuals making less than $75k per year and couples making less than $150k per year, will get somewhere between a $600 to $1,200 tax refund.
  • If you’ve got kids, you’re in luck. You’ll get an extra $300 dollars per child. If I had to guess, it will be the amount of children you had as of December 31st, 2007, but I’m not sure.
  • If you make more than $75k as an individual or $150k as a family, you’re probably not going to get a refund. I’m sure you’re not crying about an extra $800 bucks, but I think the limits should have been a little higher for phase out.
  • The package also includes about $50 billion dollars in tax relief to small businesses. I’m glad they stuck something in there for the heart and soul of America, the small business, but my guess is that the deductions won’t be enough.
  • As long as you earned $3,000 last year, but do not pay federal income tax, you’ll still get $300 dollars back!

Look, do you really think that giving people a couple hundred bucks is going to help the economy? It would if they used it to pay off debt or put into a mutual fund or IRA account, but let’s be real. The reason there are hundreds of personal financial blogs out there, and the reason that people like Dave Ramsey and Suze Orman make a living off of personal financial ideas, is because we’re a bunch of crazy spenders who love debt and hate saving!

When you get this refund, please don’t go blow it. Consider it a gift and actually do something that will stimulate the economy. Buying a bunch of crap at Best Buy won’t help the economy in the long term. Paying off debt and saving for the long term will help the economy. Oh, by the way, you can expect the cash to start flowing in a couple of months, but most likely won’t hit your mailbox to May or June. And I know that I have been talking about the economy a lot lately, and I’m probably losing readers as I write, but the past few days have been VERY important for our economy and country. Be involved in current events and formulate an opinion. If the country isn’t doing well, you can still win with money, but you have to be aware of what is going on around you.

Erik Folgate
Erik and his wife, Lindzee, live in Orlando, Florida with a baby boy on the way. Erik works as an account manager for a marketing company, and considers counseling friends, family and the readers of Money Crashers his personal ministry to others. Erik became passionate about personal finance and helping others make wise financial decisions after racking up over $20k in credit card and student loan debt within the first two years of college.

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  • Casey

    So do we just need to file our taxes like normal and pay whatever we need to pay?

  • author

    yeah, you file all of your taxes like normal. Then, you’ll get the refund check sometime in the summer. It’s pretty sweet, but I don’t think it’s going to help the overall economy that much.

  • http://www.moneycrashers.com/congress-agrees-to-stimulus-package-that-puts-your-money-back-into-your-pocket/#comments MJS

    Not that all Americans will do this, but how does receiving cash from the U.S. government and spending it on items made from the Far East help the economy?

  • author

    Yeah, that’s what Huckabee said last night at the florida debate. He makes a good point. That’s why I am urging people to pay off debt and/or put in savings. You don’t have to spend money to stimulate the economy. Putting yourself in a better financial situation will stimulate the economy in the long-term, because you’ll be in a position to save more AND spend more.

  • Jennifer

    if you owe taxes will you still get the refund or will the IRS apply it towards what you owe?

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