by Ivana Xie
MILLIONS of Americans will be getting payments ranging from $200 and $1,700.
Coloradans who already filed their 2021 tax return by October 17 can expect to get their payments by the end of January.
California’s Middle-Class Tax Relief payment has been sent out in separate batches since October, and Americans should have received their money by January 14.
Idahoans had until New Year’s Eve to file their 2021 taxes and claim their rebates, which are worth between $75 and $600 and expected by early this year.
Pennsylvania is offering multiple rebates worth up to $1,658 for older, low-income renters and property owners.
People who file their 2021 tax return by the February deadline should receive their check the following month.
Low-income residents in NY eligible for $500 payments
Hundreds of low-income residents in Rochester, New York are set to receive $500 reoccurring payments in just a few months.
“The GBI program will provide marginalized communities with critical resources and help to close the community’s wealth gap while boosting our residents’ ability to become homeowners,” city officials said in a statement.
The guaranteed income pilot is available thanks to the county’s council voting last year to allocate a total of $2.2million towards the program.
Income must be at or below 200 percent of the federal poverty level to qualify for the program.
A Rochester spokesperson told The Center Square that a different group of 175 residents will be getting $500 payments in 2023, which is set to launch in early 2023.
Pennsylvania drivers receive $3,000 rebates
Depending on household income, the Pennsylvania Department of Environmental Protection (DEP) now offers rebates for drivers who go electric.
The payments are on a sliding scale from $2,000 or $3,000 after the (DEP) recently changed the maximum amount received from $750 and $1,000 for low-income applicants.
The program will offer rebates starting September 1 until June 30, 2023.
MTCR sends debit card
You will be getting your payment by mail in the form of a debit card if you’ve completed a set of tasks.
You’re eligible to get your payment in a debit card if you’ve filed a paper return and had a balance due.
In addition, you received your Golden State Stimulus (GSS) payment by check and received your tax refund by check regardless of filing method.
Eligibility for MCTR
You are eligible to receive a refund if you filed your 2020 tax return by October 15, 2021, and meet the California adjusted gross income (CA AGI) limits.
In addition, you must also be a California resident for six months or more of the 2020 tax year.
Californians will receive their MCTR payment by direct deposit or debit card, and direct deposit payments are for taxpayers who e-filed their 2020 CA tax return and received their CA tax refund by direct deposit.
- What is the Middle Class Tax Refund?
- California sent out $9.5billion in relief funds to taxpayers with adjusted gross incomes of less than $500,000.
- Payments range between $200 to $1,050 depending on your California-adjusted gross income.
- MCTR payments continued to go out through January 15.
Lowering your tax liabilities, avoiding penalties
Lastly, make sure you’ve been paying the correct amount for withholdings.
It’s better to overpay and get some of that money back in a tax return than to underpay and owe a penalty come April.
You can use the IRS’s Tax Withholding Estimator to determine if you need to update your withholdings or quarterly tax payments.
Lowering tax liabilities, retirement contributions
People who are able to contribute the maximum amount to retirement accounts will lower this year’s tax bill.
This means taxpayers will get tax-free growth on the account.
Another option is to pay taxes on your contributions now and enjoy tax-free withdrawals when it’s time to retire.
For 2022, your maximum 401(k) contribution is $20,500 for those under 50 or $27,000 for those over 50.
Lowering tax liabilities, group itemized deductions
Taxpayers may take the standard deduction depending on their filing status or if the deductions exceed the standard amount they can itemize expenses.
If possible, try bunching together as many deductions this year as next year you’ll be able to lower your deductible expenses and claim the full standard deduction regardless of annual expenses.
This will also reduce your long-term tax implications allowing you to keep more income.
California families earning direct payments for another two years
The Yolo Basic Income Program (YOBI) started last spring, but the Board of Supervisors just voted to allocate an additional $550,000 for the California families it serves.
To qualify, families must have at least one child younger than six years old.
Nearly 76 households received monthly payments of $1,200 to $1,500 for two years.
YOBI preselected the families and applications were not open to the public.
The program is designed to boost these families above the poverty line in California, which is about $25,000 for a family of four.
Concerns mount over if relief checks are driving up inflation
Several economists and financial experts are worried inflation relief payments will actually further the rising rate of inflation, reports The Lee Daily Register.
Beth Akers, a senior fellow at the American Enterprise Institute, said handing out money during a period of inflation will only lead to further inflation.
Furthermore, she warned the checks could leave several states in the red next year as growth in tax revenue starts to decrease.
Austin will increase E-bike rebates in January
Austin is planning to hike the current rebates for individuals and groups who purchase E-bikes, according to a memo from city officials.
The maximum rebate total for single E-bike purchases would increase from $600 to $1300 with combined rebates from Austin Energy (AE) and The Austin Transportation Department (ATD)
While group, multi-bike purchases would not be eligible for the ATD rebate, the maximum rebate would increase from $400 to $800 per unit.
In addition to E-bikes, most electric two-wheel vehicles, like mopeds and motorcycles, will also qualify.
City officials may adjust the specifics of the rebate expansion based on community feedback, the memo stated.
Richmond property owners get new rebate
A deal has been made to give hundreds of thousands of Richmond residents property tax rebates next year under an $18million plan.
Richmond, Virginia Mayor Levar Stoney and six city council members have agreed on a plan to send out rebates that would reduce a property owner’s tax bill by five cents per $100 of assessed property.
Currently, property owners pay $1.20 for every $100 of property, but under the mayor’s Five Back initiative, that number would go down to $1.15.
“So, a home assessed at $350,00 and a real estate tax bill of $4,200 would receive a one-time rebate of $175,” Mayor Levar Stoney said.
The rebates will cost the city $18million taken from its budget surplus for 2022.
State relief programs
A number of other states are also providing relief payments in the coming months.
- Alaska: Combining energy relief and the state’s Permanent Fund dividend, Alaska has approved a $3,200 direct payment for September.
- Hawaii: Depending on residents’ income and tax liability, Hawaii and Virginia residents’ are getting tax rebates that are likely to be sent out during September or October.
- Illinois: On September 12, Illinois is sending out a tax rebate to individuals who earn below $200,000.
- Colorado: Residents will be getting checks of $750 and $1,500 for couples due to Colorado’s revenue surplus.
Youth can get cash
Young adults in Louisville, Kentucky will get $500 monthly payments.
The program is called YALift! (Young Adult Louisville Income for Transformation).
The payments will go out to 150 young people between the ages of 18 and 24.
Those eligible need to live in one of the three neighborhoods: California, Russell, and Smoketown.
Inflation Reduction Act rebates, part four
There are two tax credits available for homeowners. The first is the nonbusiness energy property credit, which is a 30 percent tax credit, worth up to $1,200 a year.
This is for the installation of things like insulated windows and doors and energy-efficient skylights.
A slightly higher payout of $2,000 would go to those who install heat pumps and biomass stoves and boilers.
Inflation Reduction Act rebates, part three
Next year two new requirements will kick in:
- Requirements for sourcing of the car battery’s critical minerals
- A share of battery components must be manufactured and assembled in North America
Buying in 2022 could get you the credit without worrying about these new rules.
If you wait to buy and end up not meeting the new criteria, you’ll miss out on the credit altogether.
However, if you hold out until 2024 you’d get instant savings as the tax credit will become a discount on the price of the car.
Inflation Reduction Act rebates, continued
The tax credits for buying electric vehicles apply to both new and used cars.
Although this law has been on the books for some time now, it was tweaked when the Inflation Reduction Act was signed.
Those who buy a new car will get up to $7,500 credit, and those who buy used cars will get up to $4,000.
It’s important to note the amount you’ll get depends on things like household income and the sale price of the vehicle.
Purchases of used vehicles will qualify for the tax break starting in 2023.
Thousands of dollars of rebates in Inflation Reduction Act
The Inflation Reduction Act includes tax credits and rebates for those who turn to cleaner energy sources.
The act provides credits for those who buy electric vehicles and energy-efficient appliances, install solar panels on their home, and more, reports CNBC.
However, these incentives have different timelines for when payments will start going out.
Some consumers may have to wait until 2024 to reap the benefits.
Tax season begins next month
The IRS has yet to announce a start date for the 2022 filing season but it typically will accept tax returns in late January.
In 2022, taxpayers were allowed to start submitting their returns on January 24.
The IRS has started alerting filers to gather the necessary documents and information they will need to ensure smooth submissions early next year.
As the last quarterly payment for 2022 is due tomorrow, the IRS has advised filers to consider “estimated or additional tax payments” due to non-wage income coming from unemployment, self-employment, digital assets or other avenues.
Three federal stimulus checks
The government issued three rounds of stimulus checks during the pandemic in 2020.
The first “economic impact payment” was worth up to $1,200 and given to low-income households while the second payment was worth up to $600 at the beginning of 2021.
The Internal Revenue Service (IRS) sent a third round worth up to $1,400, to hundreds of millions of Americans.
What is a stimulus check?
A stimulus check is a one-time given to taxpayers via paper check or direct deposit.
The U.S. provided taxpayers with three checks: the first round was worth $1,200, followed by $600 and $1,400, respectively.
The package was an initial response to the economic impact of COVID-19.
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