Tax Rebate: What is it?

Answer 1

A tax rebate can mean one of two things: It can either be an amount that you reduce your taxes by prior to paying them or it can be the amount of money that is refunded to you after paid taxes. To most people, it connotes a pleasant idea of the government giving them back money they have already paid, which might occur during lean economic times, or when the taxes have been overpaid. This has been the case a few times in the United States during the 2000s. Consumers who met certain requirements for income received a check as a tax rebate, giving them additional money. As it was considered to be money that was previously paid to as taxes, this is not a source of income.

Sometimes, a tax rebate may also be referred to as a tax credit. Some people can take tax credits on their returns, reducing the overall amount that they might owe in taxes. Sometimes, the credits will only be given once, so it is important to watch for various credits that could rise in a year. Other circumstances might dictate that income will determine a person's eligibility to receive all, some or most of the taxes that are rebated to them, or they might receive money from certain programs, such as earned income credit, which will grant them money regardless of the whether they have paid taxes. EIC in particular is a federal United States program for those whose income is low.

Some define a rebate as a credit that is equal in how it treats taxpayers, though this is inaccurate. After all, some rebates will never apply to all people. Some may require having a certain level of income, requiring a specific profession or require that you have paid taxes on items like utilities. If you do not qualify, you will not receive any portion of that rebate.

Beyond filing taxes in the United States, especially during the 2000s, most people did not need to do anything particular in order to qualify for a rebate other than make a certain amount of money. These types of rebates are known as stimulus checks, and they were mailed to taxpayers during the annual filing. These are exceptional circumstances, however. You may also wish to view websites about tax laws or speak with an accountant to see whether or not you qualify for a rebate.