While several states are considering sending stimulus checks or a tax refund to their residents to offset the highest inflation in four decades in the country, coupled with rising prices due to supply chain disruptions and the war in Ukraine; Many Americans wonder if it is possible for the federal government to issue a new stimulus check or some kind of direct aid.
Analysts had predicted that the pandemic would eventually decimate state budgets; however, states like New Jersey y Connecticut they enjoy a surplus that would allow them to provide direct financial assistance to their residents, either as state tax credits, stimulus checks, or tax refunds. However, the aid plans are still on the discussion table of the legislatures.
Other states have also gained economic stability as workers have their jobs back, plus new income tax revenue, while strong retail sales are boosting sales taxes.
WILL THERE BE DIRECT FEDERAL AID?
But beyond the financial bonanza in some states, families in the country wonder if the federal government will offer financial aid directly like the one that was delivered during the pandemic.
For now, neither President Joe Biden’s administration nor Congress plans to send more stimulus checks for 2022. However, three federal lawmakers are trying to structure a stimulus rebate program in the face of rising gasoline prices.
The plan by Reps. Mike Thompson of California, Lauren Underwood of Illinois and John Larson of Connecticut would offer monthly checks of $100 to single taxpayers and $200 to couples. Households might also claim an additional $100 for each dependent they claimed on their tax returns.
“The price of gas is driving up costs across the board. My energy rebate proposal will provide some much-needed relief by putting money back in the hands of Americans feeling this pressure,” Larson tweeted on Wednesday..
“Americans are feeling the impact of Vladimir Putin’s illegal invasion of Ukraine, and right now we must work together on common-sense political solutions to ease the financial burden felt by my constituents,” Thompson said in a statement. announcement.
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The income thresholds are similar to those for the third and final stimulus check issued last year: Individual filers making less than $75,000 and couples making $150,000 would qualify for the cash. Singles making more than $80,000 and joint filers making more than $160,000 would not get help.
Oil prices began rising regarding a year ago due to pandemic-related supply chain problems, and price problems have been exacerbated by a ban on Russian oil imports in the wake of the war in Ukraine that resulted in a decline in the world’s oil supply.
As a result, Americans have been forced to pay some of the highest prices per gallon at the pump. The current national average price of gasoline is now $4.23, more than a dollar higher than the average a year ago, according to AAA.
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For months, lawmakers have been mulling over the best way to lower gas prices, but have come to no solution. Senate Democrats introduced a bill in mid-February to stop collecting federal tax (18.4 cents per fill) at the gas pump until next year, a proposal that didn’t build any momentum.
When asked regarding a gas tax exemption during a press conference on March 31, House Speaker Nancy Pelosi told reporters that the gas tax exemption is no longer the better option on the table, since oil companies do not necessarily pass the savings on to consumers, plus it would reduce the funds needed to maintain the roads.
Pelosi added that lawmakers are now considering a rebate card or direct monthly payment instead, as part of the Gas Rebate Act of 2022 introduced on March 17.
For now, Democrats are working on potential gasoline rebates, though President Joe Biden is pushing his own plans following announcing the release of an average of more than 1 million barrels of oil per day from the Strategic Petroleum Reserve over the next six months, a third of the total reserve.
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Biden warned that “there is no firm answer.” He also noted that prices might drop as much as 35 cents a gallon, but “you don’t know at this point.” The president added that it also depends on how many barrels of oil allies around the world will release from their reserves.
WHAT ABOUT STATE BUDGETS?
Americans are more likely to see direct aid from the states than from the federal government. So far, five states, including Connecticut, have introduced tax breaks for their residents, while the Gas Rebate Act of 2022 has been signed by three governors.
Republican Gov. Brian Kemp of Georgia signed legislation to send checks of up to $500 to state residents. The reason, he said in a statement, is to mitigate the impact of inflation on household budgets, and also to provide direct aid in the midst of a record state budget surplus.
In Maine, Governor Janet Mills is seeking to send $850 checks to every resident to offset inflation, including high gas prices, making for one of the most generous deals in the country.
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Separately, Republican Gov. Phil Scott of Vermont has proposed returning half of a $90 million surplus in the State Education Fund to state property taxpayers via refund checks of $250 and $275, although the Democratic-controlled Legislature appears not to support the measure.
In California, Democratic Gov. Gavin Newsom plans to send direct payments of $400 per vehicle to state residents, with a two-vehicle limit. However, the go-ahead is now up to lawmakers.
Democratic Gov. Michelle Lujan Grisham of New Mexico signed legislation to provide $250 refund checks for single taxpayers and $500 for married couples filing jointly.
In addition, Democratic Gov. Tim Walz plans to invest the state’s budget surplus in $1,000 refund checks per couple.
Indiana residents will receive $125 each following they file their taxes in 2022 due to higher-than-projected tax revenue
WHAT ARE THE STATES OF THE NEW YORK, NEW JERSEY AND CONNECTICUT TRI-STATE REGION?
NEW JERSEY
New Jersey Gov. Phil Murphy and the Democratic-led legislature included cash checks of up to $500 for regarding 1 million families as part of a budget deal last year as the governor and lawmakers prepared for the election. .
Now, the Legislature is considering a second plan that would offer $500 checks to immigrants who pay taxes using an Individual Taxpayer Identification Number (ITIN).
According to the state Treasury Department, more than 100,000 immigrants in the state (although state officials estimate as many as 80,000 households would benefit) meet the criteria for the one-time payments; however, the use of these funds from the American Rescue Plan must first be approved by the Joint Budget Oversight Committee. Here we explain more.
NEW YORK
For now, New York is offering relief to low-income New Yorkers as part of a $64 million federally funded program to help with the cost of diapers for struggling families, food expenses for households with children and adults seniors, and provide housing and relocation assistance for survivors of domestic abuse.
But New Yorkers are still awaiting the state’s fiscal year 2023 budget, which might be reconciled as soon as Thursday following a week’s delay.
In her fiscal year 2023 budget plan released earlier this year, Governor Kathy Hochul proposed a $1 billion property tax rebate to offset some of the financial burdens New Yorkers face as inflation rises. . The program returns tax dollars to low- and middle-income households, with low-income households and seniors receiving greater benefits. Open here for more details.
CONNECTICUT
The Tax Writing Finance Committee voted Tuesday to not only cut taxes to help families with children, but also agreed to increase the state’s earned income tax credit, which is specifically aimed at providing a strong economic boost to low- and moderate-income workers. The tax benefit would increase to 41.5%, as of the current calendar year 2022.
The committee also agreed to create a child tax credit for the first time in Connecticut, which would provide a maximum of $600 per year for households with up to three children.
The credit would be available to single parents earning up to $100,000 per year and married couples earning up to $200,000 per year.
For years, Connecticut did not have a state earned income credit as opposed by Republicans and several governors, though that changed in 2011 under then-Governor Dannel Malloy. Click here for more information.