The primary focus of the stimulus checks has now turned to state governments in 2022 as federal support dried up with the expanded Child Tax Credit stimulus check in December 2022. With the Biden administration hamstrung by the political gridlock in Washington, all federal support measures died a quiet death in 2021.
The Republicans refused to back Biden’s request for more support, especially extending the expanded Child Tax Credit stimulus checks through 2025, though they were all for extended tax holidays for billionaires, their primary backers.
But the relentless rise in prices that began in the first quarter has made it more than ever necessary to send further support to citizens. Rising prices across sectors have assailed low and moderate-income people and things have turned worse as there appears to be no respite a year down the line.
Successive federal support measures kept people on support through the peak months of the pandemic, and also later as a severe economic meltdown brought the economy to its knees.
But the economic downturn did not last long, unlike the Great Recession of 2007-2009. This had a lot to do with the $1.9 trillion pumped into the economy under the American Rescue Plan Act, signed by President Biden in March 2021, two months after he assumed office following a controversial post-election tantrum by outgoing president Donald Trump as he refused to relinquish power despite the results showing Biden as a clear winner.
Biden came riding on the promise of a $2,000 stimulus check. it helped him retain the Georgia congressional runoff election. It also helped the Democrats wrest control of the House and the White House. Though the Senate was split right down the middle, the democrats managed to retain control thanks to the tiebreaker vote of the vice president. But opposition within his party has stymied attempts to send out further stimulus checks.
The federal support measures found overwhelming backing from Americans with over 80% supporting the measures taken by the Biden administration to support the millions affected by the pandemic and the economic downturn. And among the backers were a majority of Republican voters.
But this support found little resonance among the Republican opposition as they tore in the Economic Impact Payment and blamed it for the recession. With the midterms approaching, Biden decided to play it safe and not press for further stimulus checks. The third economic impact payment proved to be the last of the stimulus checks in 2021, though it was not the last of the federal relief measures.
The expanded Child Tax Credit stimulus check that was paid out as an advance against the 2021 income tax returns was sent out between July and December 2021. 50% of the total amount of between $3,000 and $3,600 was sent out in 6 equal monthly checks of between $250 and $300 a child. The balance was paid after families filed their 2021 federal income tax returns in the first quarter of 2022.
States Move In With Stimulus Checks For Residents
In the absence of federal support, state stimulus checks have continued to be the support lifeline for millions. Starting with states such as Maine and New Mexico, over 20 states have sent out some form of inflation relief measures for their residents.
This support has not been as generous as the federal stimulus check, but they have been a source of much-needed support for residents reeling from the high price of goods and services starting from the first quarter of 2022.
The payments by various states have continued into the last quarter of 2022 and there are payments scheduled even in December.
California has been sending out inflation relief payments to around 23 million of its 39 million residents. The payments can go up to $1,050 for residents with 2020 Adjusted Gross Income of up to $150,000 for married couples filing jointly.
The amount in this tier comes to $350 for each filer plus another $350 if they declare any dependents. Individual filers with an AGI of up to $75,000 will receive a stimulus check of $350 plus another $350 if they include a dependent in their tax return.
The stimulus check amount gets progressively lowed with an increase in the AGI. Residents with an AGI of between $75,001 and $125,000 will receive a stimulus check of $250 while joint filers with an AGI of between $150,001 and $250,000 will get $250 each. Another $250 will be added if the filers include any dependents.
The third tier, the highest income category under which the stimulus check is payable is worth $200 for individuals with a 2020 AGI of between $125,001 and $250,000 and between $50,001 and $500,000 for married couples filing jointly.
The amount added for declared dependents will be the same whatever their numbers. The Middle-Class Tax Rebate was approved by the state legislature way back in June 2022, though the payments commenced only on October 7, 2022.
Governor Gavin Newsom’s initial plan was to distribute a $400 debit card to owners of vehicles registered in California. Families would have been eligible for a maximum of two cards. A transit card was also planned for those not in possession of cars of a similar value.
But state Democratic legislators persuaded Gov. Newsom to instead go for the third round of stimulus checks after the Golden State stimulus checks I and II.
The payments are going out either through direct bank deposits or through debit cards. The first round of payments went out to residents who received either of the Golden State stimulus checks through direct bank transfers. Such payment continued through October. the next round of payments went to residents who filed their returns online.
Residents who have filed their income tax returns for 2020 manually will receive the payments by debit card, delivered by the US postal service.
Residents who filed their income tax returns for 2020 by October 15, 2021, are only eligible for the payments. No paper checks are being issued this time unlike during the two rounds of the Golden State stimulus checks.
The debit cards are being sent out alphabetically based on the last name of the filer. The state expects 95% of all payments to be completed by 2022 though the last day for the payments has been set at January 15, 2023.