Ok, it’s official. Pretty much everyone in America is getting a [tag]tax rebate[/tag] this summer. The IRS says they’ll start mailing checks in May. So how would you like to get a nice tax-free bonus on your tax rebate? Here’s how.
Your tax-rebate is part of the [tag]economic stimulus[/tag] package recently passed by Congress and signed by the President. You will get up to $600 per person or up to $1200 per joint couple. You also will get up to $300 per child. That money will be a tax free payment from the government. So how do you collect your bonus?
If you qualify for a deductible traditional [tag]IRA[/tag] contribution in 2008 and you put your rebate into a traditional IRA then you will get to deduct the amount of the contribution. So, if you are in the 30% tax bracket, it’s like getting a 30% bonus in the form of a deduction on your 2008 taxes (which you will file in 2009). If you are self-employed you can accomplish the same thing using your SEP or SIMPLE IRAs.