If passed by the Senate intact, taxpayers would begin to receive rebate checks beginning in May. Individuals who earn at least $3,000 but don't pay taxes would get $300. Full rebates of up to $600 or $1,200 would be paid to individuals earning up to $75,000 adjusted gross income in 2008 or couples filing jointly and earning up to $150,000. Above that, rebates would be reduced by 5 percent for each $1,000 in income. Rebates would be reduced by $50 for each $1,000 in income, meaning a couple with no children earning $174,000 or singles earnings $87,000 would have no rebate. A single mother of two children earning $50,000 and paying at least $600 in taxes would receive $1,200 —a $600 individual rebate and $300 a child. A married couple with three children earning $100,000 and paying at least $1,200 in taxes would receive $2,100 — a $1,200 rebate and $300 a child.
The majority of taxpayers would also see their tax rate reduced on the 2008 return so they won't have to pay taxes on the rebate amount. In 2008 the tax rate would be cut from 10 percent to 0 percent on the first $6,000 of taxable income for individual taxpayers and the first $12,000 of taxable income for couples.
For one year, jumbo loan limits would increase from the current $417,000 limit to 125% of the area median price for a residence of the applicable size, but in no case to exceed 175 percent of the limitation.
Another temporary change in the Tax Code would allow American businesses that buy new equipment this year to deduct an additional 50 percent of the cost of their investment in 2008. Section 179 deduction would also increase to $250,000 with phase out exceeding $800,000.
For more info, click here to view H.R. 5140.