Due to the sagging economy and election-year politics, Congress and President Bush moved to enact a bipartisan economic growth package to put money back into the hands of American workers. Accordingly, between May and July, the Internal Revenue Service (IRS) will mail checks of up to $600 per taxpayer—and $300 per child—to qualifying taxpayers.

Basic qualifications

The requirements for receiving a payment are a valid Social Security Number, at least $3,000 in earned income, and filing a 2007 tax return. IRS will take care of the rest, from confirming your eligibility to direct depositing the money to the same account used for your 2007 return or mailing a check to you.

Different from last time

In 2000, the last time taxpayers were given a rebate, it ended up being a so-called "pre-bate," reducing the refund on the 2001 tax return, and in effect, making it a 6-month advance on the refund taxpayers would have received anyway. The staggering cost of delivering this loan caused a firestorm of protest.

Although the details of the program are still being worked out, IRS has clearly stated on its website that it is not taxable and "will not reduce your refund or increase the amount you owe when you file your 2008 return." However, if not received, there will be an accounting on your 2008 return to claim your payment.

The preceding discussion is general in nature, and should not be considered advice for any individual tax situation. You should consult with your personal tax planning professional for specific guidance relating to your unique circumstances.