The lack of any federal stimulus checks has turned the spotlight on state relief for residents.
Inflation relief payments have turned indispensable as record inflation has turned most goods beyond the reach f residents. The record rise in inflation coincided with dwindling federal support including the expanded Child Tax Credit stimulus checks.
For the majority of citizens, especially low and moderate-income groups, the string of stimulus checks helped them avoid the clutches of poverty, avoided mortgage and other loan payment defaults, paid off their rent, and even helped them set aside a part of the payments. For the first time in their lives, many Americans were able to rise above debts and make some savings instead of living just paycheck to paycheck.
The abrupt end of multiple federal support by 2021, including the vital expanded Child Tax Credit, left millions of Americans facing the same despairing and hopeless situation of the post-pandemic period, as the total shutdown in the first and second quarters of 2020. It left millions of households and individuals without any source of income.
For the first time in over 4 decades, inflation went past the 8% mark. It even surpassed 9% in June 2022 and continues to stay above the 8.5% mark. It is only in October that the US inflation rate has eased a little and stands at 7.75%, compared to 8.2% in September, a drop of 5.56%. But it remains more than 1.5% above the figure a year ago when it was 6.22%. And it is still more than twice the long-term average of 3.27%.
States Rely On Federal Funds To Support Residents With Inflation Relief Stimulus Checks
The price of every essential product crossed record levels in 2022. From groceries to gasoline, people had to cut down on consumption to match income with rising expenses. The partisan stance of the Republicans ensured that federal stimulus checks would remain out of bounds for Americans at least till the midterms.
But federal support, especially the amount sanctioned by President Biden immediately after he assumed power continues to fund a greater proportion of the state relief measures.
The American Rescue Plan Act signed in March 2021 did way more than send out the Economic Impact Payment or the third stimulus check. it also laid out a slew of measures that covered every organization, business, and local, tribal, and state government.
California has announced the biggest of the inflation relief schemes among the states. Around 23 million residents of the Golden State will benefit from the Middle-Class Cash Back stimulus checks. The maximum amount will go to households with an Adjusted Gross Income in the lowest tier.
The relief package for Californians was signed back in June 2022 by Governor Gavin Newsom. The $308 billion budget included a relief package worth $17 billion. The relief package was to support residents to counter the rising price of gasoline and other prices. Gasoline prices in California are the highest in the country, as a result of cleaner fuel and higher taxes.
The payments would also help residents pay rent and utility bills. The relief stimulus checks are being dispatched as tax refunds. The relief package will also pay for the suspension of state sales tax on diesel for a year starting October 1, 2022.
The state government stepped in after California registered the sharpest spike in the price of gasoline as it crossed $7.5 a gallon before settling down. In recent weeks it has again been on the rise.
Governo r Newsom had earlier contemplated distributing a $400 gas card to vehicle owners for cars registered in the Golden State. Each family was to be given a maximum of two cards. Households with cards were to be given transit cards within the limits of the state.
But Democratic Party lawmakers pressed for a better plan aimed at provided a relief package aimed at providing a more comprehensive relief package for residents affected by rising prices.
The office of the Governor finally reached an agreement with the state legislature on the amount to be allowed and the beneficiaries. Immediate steps were taken to benefit the low and middle-class filers in the state as they continued to face high prices of essential items. Gov. Newsom said that people continued to grapple with expanding costs amid global inflation brought about by a combination of multiple factors including the supply chain disruption and the war in Europe.
While the payments will no doubt make it easier to bear the all-around rising costs of gasoline and other essentials, it has also led to the question about the effect it could have on the already overheated economy that continues to reel from the uncontrollably high inflation rate.
The inflation rate began to inch upward during the time the Rescue Plan was finally signed by President Biden. It has stayed on track for a relentless rise and crossed 8% at the beginning of the year and has stayed consistently above that mark and touched the highest in 4 decades.
The annual American inflation rate remains at 8.3% for the 12 months ending August 2022 after reaching 8.5% in July and though its highest of 9.1% in June 2022. It remains the highest since November 1981.
The California Stimulus Check Has Been Sent As Tax Refunds
The whole of the Middle-Class Tax Rebate Stimulus Check is being sent out as tax refunds. The funding is being made through the huge budget surplus of $97 billion enjoyed by the Golden State. the inflation rebate is going out based on the filer’s income, filing status, and the inclusion of dependents. The amount given for the presence of dependents is fixed irrespective of the number of dependents declared.
Individual filers with a 2020 Adjusted Gross Income below $75,000 and joint filers with a combined AGI below $150,000 are in line for the highest amount possible under the Middle-Class Tax Rebate of $1,050. Individual payments are $350 for each filer plus another $350 for
There are two other tiers the middle one for the $250 stimulus check for an AGI between $75,001 and 125,000 for individuals and between $150,001 and $250,000 for joint filers.
The uppermost category is for an individual AGI of between $125,001 and $250,000 and between $250,001 and $500,000 for joint filers. This tier brings in $200 individually with the highest possible stimulus check of $600.
