The people who are really going to get shafted is anyone who made under the cap for the goodie bag in 2006 and don't qualify in 2008. They'll get the rebate and then owe it back. I'm hoping that they will base it on the 2007 AGI (because I went be to work Jan 2,2008). In other words, the government cuts the check based on the 2006 return but then will adjust on the 2007 return. Then if the taxpayer makes ovr ethe threshold in 2007, they will owe it back in 2008. AcK! If the plan is this confusing how can it be good or even reasonable?

Hi again, everyone, Update on the above info, offered by my friend the accountant whom I first met at the investment group about 5 years or more ago. The guy who retired last year, without a pension, and who now borrows at about 6% (interest deductible when used for investment) and puts it out to earn about 12% (much of current return at low tax rate, some of it deferred, to be taxed at low rate when withdrawn). He says that the amount of current income that that can be obtained free of tax is closer to $50,000.00. Same provisos as outlined above - with possibility of bumping up the amount that is received free of tax given some of the situations as mentioned. Sorry that the situation applies only to Canadian residents, folks. Good wishes to you and yours. ole joyful P.S. We had a visitor/new member at our investment group last week, who said that she felt rather at sea, among such skilled investors. We told her not to feel bad - that in the investment game, there are no stupid questions. That she should ask any of us to explain various terms or situations that were unfamiliar to her. Each of us learns as we go, a step at a time. Compensation usually increases commensurate with increased knowledge! o j

FYI - from Suite 101: "Each year, the IRS (Internal Revenue Service) audits approximately 1% to 2% of tax returns filed. When your tax return is submitted, a computer processes it. When your return has errors, does not fit in with statistical norms or is unusual in any way, it can be flagged by the computer, meaning that it must be manually reviewed. Although not all returns that are manually reviewed are audited, it is from this pool of returns that audits are often chosen."

My suggestion to clients (and others - like, for example, here) was that I don't like getting tax refunds - which means that I paid too much from every payment, last year. If a person gets $1,200.00 back, it means that $100.00/mo. too much was deducted and sent to the income tax people every month last year, on which they paid no interest. Then your loan to them stayed at $1,200. from Jan. 1 till (Canada) the end of April, on which they paid no interest. It used to be that they'd start paying interest on overpaid money beginning May 1 ... but a few years ago they dropped that date back to June 15 (by which time a major part of the refunds had been sent out). If you'd like to make interest-free loans for even a short period, I'd like to stand in line to get some - where should I stand? And how soon do you want it paid back? Heck - I have to pay the bank 5.0% (or, did, until the Bank of Canada cut the Prime Rate this morning ... and most of the banks immediately followed suit - maybe it'll be 4.5% now). I like 0% better than that. When I put my money into the bank, they give me a bit over 0% ... but not much. Have a lovely week, everyone. ole joyful ... who doesn't like to either earn - or pay - interest Why not earn? Taxed too high! (Canadian dividends much lower). o j