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To: tradermike_1999 who wrote (6750)	8/5/2001 8:09:11 PM
From: Don Lloyd	Respond to of 74559

tradermike - Probably the biggest hoax this year is the "tax rebate." The question is who called it a tax rebate. From almost the beginning the intent was to carve out a 10% marginal bracket at the bottom of the existing 15% bracket. If the legislation had not been delayed, this could have been accomplished by adjusting tax year 2001 withholding tables. Since it was delayed, and part of its justification was supposed to be economic stimulus, this pre-refunding scheme was judged to be necessary. Since tax year 2001 returns are not yet available, tax year 2000 returns were used to determine the pre-refund check size. For taxpayers with sufficient income to exceed the new 10% bracket both years, the check size should accurately reflect the correct value. For taxpayers who didn't exceed the new 10% bracket in TY2000, but will in TY2001, they should receive added tax credit when they file their TY2001 return. For taxpayers who receive a check based on their TY2000 return that is too large for their actual TY2001 return, if any, they may see part or all of the excess effectively corrected in the TY2001 filing, but there is a significant likelihood of unrecovered funds in the case of no TY2001 filing requirement, for example. Regards, Don

To: tradermike_1999 who wrote (6750)	8/5/2001 8:55:36 PM
From: Ilaine	Read Replies (2) \| Respond to of 74559

Huh? How can anyone say that the checks aren't rebates? They're sending back tax that you overpaid, this year, instead of waiting until you file your return next year. Doesn't it ever bug you that if you get a refund check, the IRS doesn't pay YOU interest? They get to use your money for months, for free. Well, they are not doing that this time, they're giving it back now. The "next April" thing is beside the point. You don't owe income tax in April, you owe them when you earn the money. The US is on a pay-as-you-go system. If you have a salary, the employer has to deduct taxes before he pays you the rest of the money, and the employer has to put that money in a special bank account and then send it to the Feds. It's actually several separate bank accounts, there's withholding, social security, state tax, and so on. If you own a business, you pay estimated tax quarterly. And woe betide you if you don't pay enough, because you'll owe penalty and interest. Further, nothing prevents you from filing your tax return on January 1, except waiting for 1099s and W-2s and so forth. So what the taxpayer is getting back is the tax he's already paid. >>Checks being mailed are really an advance on 2001 refunds<< I try very hard not to get refunds. I'd rather have the money in the bank drawing interest. It makes good economic sense to pay exactly the right amount as I go. People who like refunds are fooling themselves.