In 2008 more than 130 million qualifying Americans are received up to $600 for indivduals, or $1200 per couple, plus $300 for each child as part of an attempt to revive the economy.http://online.wsj.com/article/SB120895822363038185.html?mod=googlenews_wsj Many eligible Americans received their rebate checks in May 2008, which prompted retailers and small business owners alike to scramble to attract consumers. http://www.msnbc.msn.com/id/22782454/ The 2009 stimulus package does not include rebate checks, but it does offer income tax rebates, giving you a little extra money to spend, invest or save.http://www.savingtoinvest.com/2009/01/no-second-stimulus-rebate-checks-1000.html

While most people choose to spend their rebates paying off debt or using the extra cash for necessities like gas and groceries, others are following advice to invest in a retirement plan, or open a fund for a child's education.http://www.msnbc.msn.com/id/22808757/ If you feel comfortable enough with your financial situation to justify a government-funded splurge, there are plenty of options to consider. This guide walks through the 2008 rebate, but can help you decide what to do with the extra cash if another tax rebate comes.

The 2008 rebate depended on your adjusted gross income of 2007 and whether or not you filed as an individual or a household:

1. Calculate your 2008 rebate to determine exactly what you will receive.http://www.irs.gov/newsroom/article/0,,id=179095,00.html 
2. If you still have questions about your filing status or what rebate to expect, check out David McPherson's answers to additional tax rebate questions.http://abcnews.go.com/WN/Story?id=4197208&page=1 

If you are deeply in debt or unprepared for the future, it is best to really consider how you will use a tax rebate.

1. If you are in debt, unemployed, or unprepared for retirement, it is important not to view your rebate as "found money," but rather an opportunity to save for the future.http://online.wsj.com/article/SB120895822363038185.html?mod=googlenews_wsj 
2. With rising prices for food, gas and basic necessities, even if you feel comfortable spending your rebate, you might want to save at least some for later on.http://online.wsj.com/article/SB120895822363038185.html?mod=googlenews_wsj 
3. Before doing anything else, be honest with yourself about your debt and how much you owe. If you are paying high interest payments each month on credit cards or private student loans, using your rebate windfall to lower payments makes a lot of sense.http://www.bankrate.com/brm/news/Financial_Literacy/debt_management/debt_pay_down_strategies_a1.asp?caret=86b 
4. Critics of Bush's $168 billion stimulus package argue that the government has never "incentivized saving", which is arguably a part of the economy's problem.http://www.newamerica.net/publications/articles/2008/dont_spend_your_tax_rebate_7016 Just because the federal government is encouraging you to spend instead of save, you should not feel guilty about keeping your rebate in the bank.http://www.newamerica.net/publications/articles/2008/dont_spend_your_tax_rebate_7016
   
5. If you do choose to spend your rebate, choose something you will be happy about later, like donating to charity, or taking a family vacation.

If you have high-interest, non-deductible debt like credit card debt, it is best to use your rebate to make a dent in it, which will in turn lower your monthly payment as well as the overall amount you will pay creditors. Consider switching to a lower rate credit card and using your rebate to pay down the debt.http://www.msnbc.msn.com/id/22808757/page/2/

Recent graduates struggling under massive student loan debt, particularly if it was issued by private lenders using variable rates, might use their rebates to make an extra loan payment towards principal.http://www.aessuccess.org/manage/your_account/taxes/tax_info.shtml 

If you have an adjustable mortgage whose rate is about to jump, you might use your rebate to offset increased monthly payments. Don't pay down your mortgage if you're carrying non-deductible debt like credit cards or private loan interest.http://money.cnn.com/magazines/moneymag/money101/lesson9/ If all other debt is under control, then it might be time to make an extra mortgage payment, reducing the duration of your mortgage overall and saving you interest.http://www.msnbc.msn.com/id/22808757/page/2/

Consider using your rebate check to contribute to an existing 401(k) or 403(b) plan, especially if you are part of a matching program through your employer.http://www.msnbc.msn.com/id/22808757/page/2/ If you have not started saving for retirement, think about opening a Roth IRA, in which your money grows tax-free. Contribute to it regularly to avoid working until the day you die.http://www.msnbc.msn.com/id/22808757/page/2/ In 2008, you can contribute up to $6,000 to a Roth IRA, which includes a $1,000 "catch-up" allowance for individuals aged 50 or older.http://online.wsj.com/article/SB120895822363038185.html?mod=googlenews_wsj 

You might also choose to open a health savings account to cover medical expenses that may increase in retirement or not be covered by insurance. Plus, a health savings account means that contributions are tax-deductible, and withdrawals are tax-free for most medical expenses.http://online.wsj.com/article/SB120895822363038185.html?mod=googlenews_wsj 

If you feel confident about your retirement fund, consider starting an account that will help your children or grandchildren pay for school, or retire someday themselves. Try starting a 529 college savings plan for a child or grandchild that you can continue to contribute to, tax-free, over time.http://www.msnbc.msn.com/id/22808757/page/2/ Think about saving for tuition even if your kids are still quite young, like the Karas family did—putting $1200 in college savings funds for the future education of their kids, aged 1 to 11.http://www.usatoday.com/money/perfi/taxes/2008-04-14-tax-rebates_N.htm 

It is also a smart idea to put aside your rebate for an unexpected expense. Use your rebate check to open a savings account for emergency funds.http://www.msnbc.msn.com/id/22808757/ Or try opening a high-yielding savings account to earn a little return on your money.http://online.wsj.com/article/SB120895822363038185.html?mod=googlenews_wsj If you keep contributing to your emergency account each month in reasonable increments (say $50 a month), you can have a financial cushion should you need one.http://www.msnbc.msn.com/id/22808757/ 

Or you might try pre-paying regular bills like your heat and electricity, or your cell phone, so that if you lose your job, or suffer another financial blow, you will be sure to have the basic necessities for a period of time.http://www.msnbc.msn.com/id/22808757/ 

Car: Keeping up to date on regular car maintenance can save you thousands over time. You can use your refund for scheduled service, or other helpful car maintenance ideas.http://www.msnbc.msn.com/id/22808757/page/3/ 

Home: Most homeowners have a wish list of improvements. 

1. Buying energy efficient appliances for your home will not only help the environment, but it can save you hundreds each year on your energy bill.
2. Also think about starting projects like fixing your roof or cleaning the gutters that you might not have factored into the budget.
3. Painting a room can be a terrific update, too.
4. Maybe you need furniture for a new baby.
5. Or perhaps you should invest in a new grill for summer barbecues (which may reduce your expenses for dining out).http://www.msnbc.msn.com/id/22808757/page/3/ 

Garden: Investing in landscaping can improve your home's value.

1. Try using your rebate to plant trees, a new lawn, or a vegetable garden.
2. You could also pay for any needed maintenance of your lawn or garden.http://www.msnbc.msn.com/id/22808757/page/3/ 

Many consumers plan to put their refunds right into the gas tank, fueling the oil economy instead of retail markets.http://www.usatoday.com/money/perfi/taxes/2008-04-14-tax-rebates_N.htm Others say they'll use their rebates for everyday expenses like groceries, or simply to help confront sharply rising prices on necessary goods.http://www.msnbc.msn.com/id/23903459/ Even if people are not spending right away on these necessities, they are putting rebates in savings accounts to help budget for food and other items.http://www.msnbc.msn.com/id/23902671/ 

You may also consider going back to school or making sure you are as healthy as can be.

1. Think about taking a class or getting help from a resume professional, both of which could lead to a career (and income) boost.
2. Or try taking a personal finance course to learn even more about how you can save and invest.
3. You might also want to consider seeing your doctor for a check-up.
4. If you've been putting it off because it seemed too expensive or wasn't covered by your insurance, make an appointment at the dentist or eye doctor. Learning preventative care now could save you thousands on pricey dental care, often not covered by insurance, later down the road.http://www.msnbc.msn.com/id/22808757/page/2/ 
5. Or, use it to pay existing healthcare costs, many of which have risen sharply over the years.http://www.usatoday.com/money/perfi/taxes/2008-04-14-tax-rebates_N.htm 

Disclaimer: The content in this page is not a substitute for professional financial advice. Please contact a finance professional before using the information presented here.