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Tax Rebate Questions

What is a tax rebate?

A tax rebate is money that is remitted by the government to a tax payer who has overpaid the Internal Revenue Service. Tax rebates are calculated during the filing of a tax return and is common in the United States. Below are some of the most commonly asked questions about tax rebates answered by the Experts.

If a person bought a house that qualified for the 2010 tax rebate for $51,000 and borrowed another $11,800 plus $2,894 for closing cost, what would be the amount that they could claim for the tax credit?

Typically the home buyer’s tax credit is based on the purchase price of the property which is defined as the “adjusted basis” on the date of purchase. If the closing statement shows the $11,800, then the amount could possibly be included in the adjusted basis. Or if repairs were prior to the closing date, then they would be eligible, although the IRS would probably challenge this because the repairs wouldn’t be shown in the Department of Housing and Urban Development (HUD-1) forms.

If a person made more than $3,000 with their retirement and more than$3,000 with their Social Security disability which they paid federal taxes on, then what would their tax rebate be?

In most cases if a person’s income is only from retirement and social security benefits, then that person would be eligible to get $300.00 for their rebate.

Would a person be eligible to get a first time home buyer tax rebate check for a home that was purchased in April of 2004?

In most cases there would not be a first time home buyer credit for a house bought in 2004.

If a person files an extension do they still qualify for the federal tax rebate?

In most cases if an extension is filed the federal tax rebate will be received when they file their next year’s tax return.

If a person buys a manufactured home that qualifies for the tax rebate refund, when would they need to fill out the application for this rebate? And is this a finite fund, and if so should I rush my application?

Typically the Internal Revenue Service does not have limited funds for tax rebates, while some states offering first home buyer credits may be limited. As long as the first time home buyer qualifies and purchases a home prior to the 11/30/09 deadline they will receive this credit. There is no application to fill out, the credit will be sent in the form of a tax refund, which can be claimed either when they file their 2009 tax return, or they may amend their 2008 return in order to claim this credit in a timelier manner. The reasoning behind the tax rebate is that money given back to the taxpayer could fuel the economy. For instance the government authorizes a tax rebate that gives money to millions of Americans, who in turn spend the money at the store, which gives the store money to buy more goods and provide jobs and so on down the line. However it is debatable on whether the tax rebate really works and who better to answer these questions, and many more like them than the Experts.
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