There Still Time To Claim Federal Stimulus Checks: States Continue To Send Out Inflation Relief Payments

Tax Package Stimulus Check

It is more than three years since the first round of stimulus checks reached Americans. It signaled the start of sustained support from the federal government, especially to low and moderate-income families and individuals. The support systems sustained through the pandemic and later even as the country remained in the grip of a recession.

The recession gave way to a mini-boom in the economy in the last two quarters of 2021. But the brief period of support again turned gloomy rising prices decimated the turnaround witnessed in 2021.

The year 2022 has been marked by an unprecedented rise in overall prices that decimated the progress seen in the latter half of 2021.

The end of 2021 also marked the conclusion of all forms of direct stimulus check support. It was in the second half of 2021 that the expanded form of the Child Tax Credit stimulus check was first paid. The monthly check was paid out between July and December 2021.

The CTC stimulus checks were the most effective poverty-alleviating measure ever undertaken. It was also unique as for the first time the Child Tax Credits stimulus check was sent out as an advance against taxes to be paid in the next tax season, in this case, 2022.

The Recovery Rebate Credit Claim Will Give You Our Stimulus Check

The federal stimulus checks are a tax credit from the federal administration and are also known as the Recovery Rebate Credit. And to claim the RCC for a particular accounting year. But you need to beware as you may be subject to fines and penalties for failing to file the income tax return by the cut-off date. 

The government is also empowered to reduce your tax refund amount to clear off any amount that you might owe by way of taxes. The government will reduce your tax refund and also adjust the due amount of other federal or state debts. 

The State Stimulus Checks Helped Face Inflation In 2022

The third round of the Economic Impact Payments signaled the end of the direct stimulus checks that the federal administration gave out as pandemic relief funds. The last round was part of the American Rscue Plan Act. This bill was signed by President in March 2021, within weeks of assuming power in January of the same year after much political drama in Washington as President Trump refused to relinquish his post despite Biden emerging as a clear-cut winner. 

Notice 1444-C sent y the IRS along with the stimulus check detailed the amount that each beneficiary received. With the aid of this letter beneficiaries also got a chance to file their previous income tax returns and claim the first two rounds of the stimulus check that were paid out within one year of the pandemic being declared in between April 2020 and January 2021.

The Rescue Plan was the most comprehensive of the stimulus checks and sent out several direct and indirect money in the form of direct bank transfers, pre-paid debit cards, and paper stimulus checks through the US Postal Service. The Federal government also relied on tax rebates and the expanded unemployment checks that it continued till September 6, 2021.

Millions Await Another Round Of Stimulus Check 

While the three rounds of stimulus checks were the last of the federal effort, close to ten million Americans continue to await their stimulus Payments with some families deprived of all the rounds of payment. The IRS admitted that they were initially misled into giving the payments only to those whose data was in their records. 

This implied that the IRS only contacted families and individuals who submitted income tax returns either in their state or the federal administration. But the IRS database was majorly flawed and only had the names and records of individuals and families that are regular tax filers.         

But the American population comprises a significant number of individuals whose income is way below the first slab of income taxes under which no income tax is charged by the federal government. The administration also followed a staggered system of payment whereby, families and individuals who exceeded the cut-off adjusted gross income amount set up by the federal administration continued to receive a stimulus check. 

But the amount of the stimulus check decreased with an increase in the AGI amount and disappeared at one stage for both individuals and families. 

The Child Tax Credit Remains The Finest Instance Of Federal Support

The enhanced Child Tax Credit stimulus check remains one of the most successful initiatives under the American Rescue Plan Act of March 2021. President Biden had initially planned to extend the CTC stimulus check through 2025 and even make it a permanent feature in federal stimulus aid. 

But the Republicans tried to pin the blame for rising prices on the stimulus check and the CTC payments. This effectively killed the chance of any subsequent stimulus check after the end of the Child Tax Credit in 2021.

But experts say that it was a political ruse and mostly untrue. Instead, the benefit of the CTC payments far outweighed any drawbacks. The enhanced Child Tax Credit payments were insufficient to significantly impact inflation. But it was enough to make a big difference in the lives of those families who were most affected by the pandemic. For the first time, parents were able to provide regular food and ensure safe housing for their kids for months at a time. 

The state stimulus checks in 2022 were a welcome relief from inflation but their range and support were limited. States mostly had to rely on federal funds, especially the Rescue Plan, to support their residents. Only some states such as California had sufficient backup funds from their state revenues to help the residents face the high prices that assailed Americans through 2022 and continue to do so in 2023. 

The number of states giving support to residents has decreased from the 21 states which sent out relief in 2022. Seven states are considering more payments in 2023.

Idaho is one of the states that will be sending out inflation relief payments to residents with residents getting around $75. Main will be sending out $450 for individuals and double that amount to married couples filing jointly.