Tax Stimulus vs. Smart Money

Looks like the economic stimulus package is just waiting for the President’s signature to go into effect. Details of the tax rebates will still be worked out but if you qualify, single tax filers can receive rebates of as much as $600. Joint filers can receive rebates of up to $1,200. In addition, each dependent child under 17 can add another $300.

Those who have incomes of at least $3,000 but owe no income taxes because of credits and deductions only get $300 if single or $600 if filing joint. If you have a modest income, but have 4 children you get $1000 per kid for the child tax credit this year. I can see having to try to figure out how to not claim some deductions so a person can at least owe $1 in tax!

The feds want you to spend this money to stimulate the economy. I would rather stimulate my bottom line. My question is, what are you going to do with your ‘free money’? Are you going to go out and buy a new refridgerator and stimulate the economy or are you going to do the smart thing and either pay off a credit card or sock the money away into savings?