I've been doing some research on this topic lately and like most people I never take a second to read over the fine print because when I do the language is too complex to really understand anything. So when the Stimulus Plan was put into effect I thought I was getting free money from the government. Then I started hearing about how this is all one big joke and in reality its a loan and will effect my 2008 tax return. Oh crap! Again, the media has lied to me.
Well I felt flustered and was sure things didn't add up. Luckily one of my co workers found an article from the wise Michelle Singletary of the Washington Post who finally gave me an honest answer.
"First, this money is not taxable. And your stimulus payment will not reduce or increase any refund you are entitled to when you file your 2008 return. The stimulus payment -- some call it a rebate, others refer to it as a refund -- is based on your 2007 tax return, but it is considered an advance on a 2008 tax cut...payments will range from $300 to $600 for individuals and $600 to $1,200 for joint filers."
Rebate Fact and Fiction -- The Color of Money
So from what I understand...its not free money and will not affect your 2008 tax return. Basically they're giving us the extra money we would have received back from a tax cut in '09 this year. Well I hope this help clears things up and that your check arrives today. I'm either paying off some credit card debt or dropping the whole thing into savings. Either way, thank you.
Pink Floyd - Money