The spotlight for stimulus check payments turned from the federal administration to the states in 2022 as the latter stooped all forms of support by the end of 2021. The expanded Child Tax Credit (CTC) stimulus checks were the last of the federal payments with the monthly payments paid between July and December 2021.
These six stimulus checks paid 50% of the total CTC stimulus amount to parents and the remaining 50% was given as a tax rebate check against their 2021 income tax returns. The Biden administration was tied down by the Republicans in protracted political gridlock that forced the Democratic president to backtrack on plans for extended support to citizens, especially the expanded CTC payments.
The Republicans refused to stand by Biden’s request for expanded support for the CTC payments through 2025, though the GOP was all for extended tax holidays for billionaires, their primary backers.
But the relentless increase in all-around prices that started at the beginning of 2022 has forced the state administration to consider support for residents. Rising prices that straddled sectors assail low and middle-income individuals and families.
The situation turned desperate as the price rise remained relentless throughout the year, with the inflation rate climbing above 9.1% at one point. It stayed constantly above 8% throughout 2022. Prices of groceries to gasoline were affected and rose to unprecedented levels.
The relentless spike in all-around prices that have affected both goods and services has made it pertinent to come up with more support for citizens at the administrative level. rising prices straddling sectors have affected even the upper middle class and things have become worse as there is a marked lack of respite from this relentless rise.
The support measures undertaken by the federal administration also helped save the economy from a deep recession. The billions pumped into the economy kept it buoyant and the brief recession soon turned into an economic boom that was affected by the severe inflation in 2022.
The Great Recession of 2007-09 had a fare reaching effect on the economy and it would be another couple of years before the economy limped back to normal. The present recovery had much to do with the $1.9 T pumped into the economy under the American Rescue Plan Act signed by incoming President Joe Biden in March 2021.
Within a week, billions had been distributed by the IRS to millions of beneficiaries through direct bank transfers. A majority of the funds reached beneficiaries within weeks, something that was desperately needed as people continued to struggle financially a year into the COVID-19 pandemic.
The payments would have reached people earlier if Joe Biden’s appointment to the top job had not been delayed by the refusal of Trump to relinquish office despite his loss. He instigated and led a riot in Washington to remain in power and refused to relinquish office despite the results revealing the that Democratic Party had emerged as the clear winner.
Joe Biden came in on the promise of a bigger stimulus check worth $2,000. The assurance helped him convincingly retain the Georgia congressional runoffs. It also helped the Democratic Party gain control of the House of Representatives along with the White House. Though the senate remained split right down the middle at 50 seats for either party, the deciding vote for vice president clinched matters for the Senate Democrats.
But President Biden was hamstrung by Senators within the party who opposed his attempts to send out more federal relief in 2022.
The federal support measures were overwhelmingly backed by Americans with more than 80% supporting the steps that President Biden took to back the millions severely by the economic meltdown following the pandemic. and even an overwhelming majority of Republican voters were for further stimulus checks.
But this mass support did not resonate among the federal Republicans as they tore into the third stimulus check, saying that it was solely responsible for the rise in prices. With the midterms on the cards, Biden decided to play safe and did not press for more stimulus checks. The 3rd Economic Impact Payment proved to be the final round of payments last year, though there were other federal relief stimulus checks including the CTC payments.
State Stimulus Checks Provide Inflation Relief
Without federal support to provide relief, Americans have been sustained by state stimulus checks through 2022. The payments started with states such as New Mexico and Maine and by the last quarter over 20 states have stepped in with some form of inflation stimulus checks for residents.
Most payments have been one-offs and not as generous as the federal payments for obvious reasons. A few states have moved their payments to coincide with the festive season. California started its inflation relief stimulus checks, the third round, in the first week of October and the payments have been continuing for the past two months.
Over 23 million residents, over 60% of the population, will receive the payments. While the initial payments were through direct bank transfers, around 12 million of the payments will go out as pre-loaded debit cards.
Residents received between $200 and $1,050 depending on the filing status, the Adjusted Gross Income in 2020, and also the presence of dependents. Residents with an individual AGI for 2020 in their state income tax return of more than $250,000 did not qualify for the payments. For married couples filing jointly, the maximum allowed was $500,000.
The payments went out to residents who received any one round of their Golden State Stimulus Checks online. People who filed their returns offline will receive debit cards. Around 95% of the payments will be sent by the end of 2022, the Franchise Tax Board of California has announced. The balance payments will be completed by the second week of January 2023.
No paper checks are being issued in this third round of California stimulus checks. The debit cards are being dispatched in alphabetical order based on the last name of the recipients.
The Franchise Tax Board has announced that residents who have been sent their payments through debit cards will have to wait around 2 weeks for the cards to be delivered through the US postal services.
