How are the rebates for individuals in the 2008 Economic Stimulus Act recorded in the NIPAs?
Question
How are the rebates for individuals in the 2008 Economic Stimulus Act recorded in the NIPAs?
Answer
The Economic Stimulus Act of 2008 provides rebate payments to eligible individual taxpayers as well as tax reductions for businesses. For individuals, the amount of the rebate is determined by information reported on tax filings for 2007 and is based on filing status, level of adjusted gross income, and the number of qualifying children. According to the Joint Committee on Taxation and the Congressional Budget Office, rebates to individuals are expected to total $113 billion. The majority of rebates were sent during the initial round of payments, which began April 28, 2008, and continued on a weekly basis through mid-July 2008. For fiscal year 2008, rebates totaled about $94.0 billion.
In the NIPAs, rebates for residents of the 50 states and the District of Columbia are recorded as either an offset to personal current taxes or as a social benefit payment to persons. Rebates for individuals with tax liabilities that exceed the rebate amount are treated as an offset to personal current taxes in the NIPAs. Rebates for individuals who pay no income taxes (or for whom the rebate would exceed the amount of the income taxes they do pay) are treated as a government social benefit payment to persons in the NIPAs.
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