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Tax rebates to start coming in July, O'Neill says

WASHINGTON (CNN) -- Uncle Sam will send a letter to taxpayers July 12, telling them how much they will get back under President Bush's recently approved tax plan and when that check will arrive, Treasury Secretary Paul O'Neill said Sunday.

Speaking on CNN's Late Edition with Wolf Blitzer, O'Neill said the first 11 million checks will be mailed July 20. The mailings of 11 million refunds weekly will continue until the week of September 28.

 A $1.35 trillion deal image
The compromise tax cut worked out by House and Senate:

• cuts the top income tax rate from 39.6 to 35 percent
• doubles the $500 child tax credit
• eliminates the federal tax on large estates
• provides marriage penalty tax relief
• gives $300 rebates for single taxpayers and $600 for joint filers
• raises contribution limits for IRAs from $2,000 to $5,000
• raises contribution limits for 401(k) plans from $10,500 to $15,000.

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"The money's going to be flowing, and we're anxious to get it out there to people," he said.

Single taxpayers will receive up to $300, married couples up to $600, and single-parent taxpayers up to $500.

O'Neill said all people who paid income tax in 2000 will get a rebate.

"I think that it is clearly true that as a result of the rate reductions that people are going to get and the other provisions of this tax bill, we're going to see a relatively higher level of economic performance than we would have had without this tax reform," he said.

On Saturday Bush heralded the passage of his tax bill by Congress in his weekly radio address.

"Soon Congress will send me a bill reducing federal income taxes by $1.35 trillion over the next 11 years, and I will proudly sign it," Bush said.

The president touted some of the key provisions of the bill, which will provide refunds this summer for 98 million Americans. Bush pointed out the tax bill will double the per-child tax credit to $1,000, reduce the marriage penalty and eliminate the inheritance tax.

Bush said there are other provisions of the law that have not received as much attention but would nonetheless make a great difference in the lives of many Americans.

The new law will make the child tax credit partially refundable. "Right now many poor families don't qualify for the credit because they don't pay income taxes at all. Soon they will receive a tax credit to help meet the costs of raising their children," the president said.

For higher-income families, contribution levels to Individual Retirement Accounts and 401(k) plans will rise.

The adoption tax credit will double, to $10,000, and become permanent under the law, Bush said. "Adoptive parents have a special calling, giving a loving home to children who otherwise would have none," he said.

• The White House
• Congressional Budget Office

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