by Catherine A. Walsh, CPA, MBT

Last week Congress passed the Economic Stimulus Act of 2008. The President is expected to sign the bill this week. The new law will allow a tax credit rebate to low- and middle-income individuals and will allow a payment to certain elderly, disabled veterans, and low-income individuals as well.

Who is eligible to receive the benefit?

Generally speaking, individuals with 2007 adjusted gross income (AGI) under $87,000 for single individuals ($174,000 for married couples filing jointly) will be eligible for a tax rebate of up to $600 ($1,200 for married couples filing jointly, not to exceed their 2007 tax liability. If an individual does not have a 2007 tax liability, he may be eligible to receive a payment of $300 ($600 for married couples filing jointly) if he has at least $3,000 of any combination of earned income, Social Security benefits, and certain veteran’s benefits, or if he has tax liability of at least $1 and gross income greater than the sum of the applicable basic standard deduction amount plus one personal exemption (two for joint filers). An individual who qualifies for the rebate may also qualify for an additional rebate of up to $300 for each qualifying child.

When will the rebate checks arrive?

They will be mailed starting in early May. In order to receive the rebate, the 2007 tax return must be filed. Although it may be difficult to file your return by April 15th of this year (as discussed in the tax article published here last month, it will be beneficial. No rebate checks will be mailed after December 31, 2008. After 2008, individuals who did not receive the full rebate will have a second chance at qualifying when they file their 2008 return in 2009.