Good news on the rebate front.

If you arranged to have your federal rebate deposited directly into your bank or credit union account, there’s a chance it may already have arrived.

The U.S. Treasury yesterday began distributing the first round of federal rebates. It’s the result of the new federal economic-stimulus law which is intended to help kick-start the nation’s slumping economy.

The first batch of rebates wasn’t supposed to go out until Friday.

But the Internal Revenue Service managed to process some of them earlier than planned.

As a result, about 800,000 rebates were deposited directly into bank and credit union accounts yesterday, said IRS spokeswoman Peggy Riley

The Treasury plans to directly deposit another 800,000 rebates today, 800,000 tomorrow and about 5 million on Friday, she said.

So if you’re eligible for a rebate by direct deposit, you may wind up receiving it earlier than you figured.

That should come as good news to consumers who are struggling with soaring food, energy and other costs –– and for those who are still paying their winter heating bills, said Mary F. Bernard, president of the Rhode Island Society of Certified Public Accountants.

“The sooner you get it, the quicker you can start to invest it, pay off debts with it –– or, as the president hopes, spend it –– to put it back into the economy somehow,” said Bernard, who is also tax principal at Kahn Litwin Renza & Co., Ltd., a CPA firm in Providence.

Edward M. Mazze, former dean of the University of Rhode Island’s College of Business Administration, said that the start of the rebate distribution “is going to help raise people’s confidence in the government’s ability to follow through on something that’s been promised, and also do something to stimulate the economy. While everybody’s talking, the government is actually doing something.”

Mazze, who currently serves as distinguished university professor of business administration at URI, said, “Rhode Island is definitely in a recession,” and many other parts of the country are in the similar economic circumstances, with rising unemployment rates and a drop in confidence by business people and consumers.

“People are really living so close to the edge now, [mainly] because of the rising price of gasoline. The [rebate] money is going to immediately help,” and will also spur economic activity –– no matter if people spend their rebate money, invest it or use it to pay bills, Mazze said.

Keep in mind that the Treasury still plans to issue rebates by direct deposit first, paper checks later.

So, as a general rule, if you filled out the “direct deposit” section of your federal income-tax return, you should receive your rebate by direct deposit, too –– and get it sooner than those who’ll receive rebate checks by mail.

President Bush late last week announced that some rebates will be issued earlier than planned.

The Treasury followed up with yesterday’s first round of directly deposited rebates, Riley said.

“The simpler returns were processed through a more modernized computer system, so it speeded up the processing, and we were able to get the [rebates] out quicker,” Riley said yesterday.

The IRS is still sticking with its originally published schedule for rebate distributions. The IRS also says that rebates will continue to be distributed based on the last two digits of your Social Security number.

But the IRS now says, in effect, that the dates in that schedule are at the extreme end of the range. As a result, you could receive your rebate earlier.

For example, the Treasury originally planned to start mailing rebate checks on May 16. So if the last two digits of your Social Security number are between 00 and 09, your rebate check wasn’t supposed to be in the mail before May 16.

But the IRS now says that rebate checks for some of the people with those Social Security numbers will be mailed May 9, and that all of the checks for people with those Social Security numbers will be mailed by May 16.

In general, rebates will range from $600 to $1,200 if you’re married and filing a joint return, or $300 to $600 if you used another “filing status” on your federal income-tax return (such as “single” or “head of household”).

You may be eligible for an additional rebate amount of up to $300 for each child you have who was under 17 as of Dec. 31, 2007.

(The rebate schedule described above applies to people who filed their federal income-tax returns by April 15 and who are eligible for a rebate. If you’re eligible for a rebate but file or filed after April 15, you’ll receive your rebate later this year.)

TODAY’S TIP: The IRS still plans to mail you an individualized notice which will let you know, based on your circumstances, how much you’ll receive and when you can expect to receive it.

But because some rebates are being issued earlier than planned, some people will receive their rebates before they receive their notices, Riley said.

Keep the notice in your tax files; you’ll need it early next year, when you complete your 2008 federal income-tax return, she said.

To hear recorded messages about the federal rebate program and its rules, call the IRS’s rebate hotline toll-free at 1-866-234-2942. You can also find out more about the rebate program from the IRS Web site:

www.irs.gov

Rebate distribution

schedule

For Direct Deposit

For Paper Checks

Source: U.S. Treasury,

Internal Revenue Service