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VOL. 115 | NO. 118 | Thursday, June 21, 2001

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Checking out those Tennessee tax windfalls Nearly 1.8 million Tennesseans to hear from Uncle Sam By MARY DANDO The Daily News The check is in the mail or will be shortly and like millions of other Americans, Tennessee taxpayers are eagerly awaiting the payout from the government Following the passing of the Tax Reconciliation Act of 2001 by Congress and its signing by President Bush, the Internal Revenue Service and the Treasury Department will begin sending out checks beginning the week of July 23, with most of the mailings done by the end of September. The IRS estimates nearly 1.8 million checks totaling $755 million will be mailed to Tennessee taxpayers. The estimate is based on the fact Tennessee taxpayers filed about 2.5 million returns for tax year 1999. Is the windfall such a great idea as the economy continues to slow and unemployment figures begin to rise? One of the Republican senators from Tennessee and member of the Senate Finance Committee, Fred Thompson, certainly thinks so and strongly supported many aspects of the Tax Reconciliation Act. Describing it as "a historic tax relief plan," Thompson said Americans have seen the federal government take an increasing share of their personal income. Federal taxes are at an all-time high. The plan provides $1.35 trillion in tax relief over the next 11 years, cutting tax rates across the board, eliminating the death tax, providing relief from the marriage penalty and doubling the child tax credit, he said. Thompson claims the plan will provide an immediate boost to the economy, puts money back in peoples pockets this year and provides tax relief to every American who pays income tax. "I believe this tax relief package is an important step toward reducing the tax burden for Tennesseans," he said. Rep. Harold Ford Jr. (D-9th) is not so convinced the tax refund is such a good idea and cautions that giving a big tax handout at this stage may not be best approach to keeping the country financially on course. "We should be putting our fiscal house in order by paying off our national debt and strengthening our entitlement programs for the future," Ford said. "We cannot afford to roll the dice on a massive tax cut based on surplus projections that may or may not come true." Tennessees $400 million state budget shortfall demonstrates the risks of relying too heavily on suspect budget projections, Ford said. "When big surpluses dont materialize, states are forced to save money by cutting vital services in areas like health and education." Rep. Ed Bryant (R-7th) said he is pleased with the refund, particularly the way the government is disbursing the money. "I think the idea of a rebate is a good idea. The process they have selected is probably the most efficient in terms of getting the checks quickly in the mail and with the least expense possible," he said. Bryant also is pleased with phasing out the death tax, which will take place over 10 years and repealed in 2010. Many of his constituents are people with small businesses, which although they would not necessarily be cash heavy, would nevertheless have a good deal of the business assets in equipment worth a lot of money, Bryant said. "When these people die because much of the business is tied up in equipment their families are forced to break up the business to pay estate taxes, which can be almost 50 percent," he said. Although Congress passed the bill cutting the estate tax, the Byrd Rule in the Senate prohibits having tax cuts extending longer than 10 years. "So, the repeal of the bill can be out there for only one year. I would expect that Congress would reconsider it at that point and extend it, because I think it would be foolish to repeal the death tax for just one year," Bryant said. Tennessee taxpayers need do little more than look in their mailbox for the tax relief checks, said Dan Boone, Tennessee territory IRS spokesman. "All youll have to do is open your mailbox. You dont need to do anything special to get that check," he said. And the tax refund checks are not just small change. Single taxpayers (and married filing separately) who paid federal income taxes for 2000 could receive up to $300. Heads of households could get up to $500, and married couples could receive up to $600. Anyone who could have been claimed as a dependent on another persons 2000 tax return is not eligible for a check. Taxpayers will learn by mid-July how much they will receive. The IRS is sending out letters describing the check amount and the week it will be sent. The agency also will send a letter of explanation for taxpayers not eligible for the advance payment. Generally, the last two digits of the taxpayers Social Security number will determine when the checks are mailed, so people may get a check at different times than their neighbors or even other family members. The IRS also advises taxpayers to keep a copy of the advance letter for their records. Taxpayers who have moved should file a change of address form with the U.S. Postal Service to ensure the checks go to the correct address. Individuals who have not yet filed a tax return for 2000 will not get their tax refund checks until the IRS has processed that return.
PROPERTY SALES 116 288 17,672
MORTGAGES 143 337 20,372
BUILDING PERMITS 139 488 36,434
BANKRUPTCIES 43 158 11,322