As California stimulus checks start to go out, what you need to know


The good brigade | DigitalVision | Getty Images

Up to 23 million California residents are about to receive tax refunds of as much as $1,050, thanks to one-time incentive payments that the Golden State began deploying Friday.

The payments, which will total $9.5 billion, mark the largest program of its kind in state history.

The initiative, dubbed the Middle Class Tax Refund, comes as inflation has reached historic highs nationally. California had a record surplus of $97.5 billion when it finalized its budget, including payments, earlier this year.

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“We know it’s expensive now, and California is putting money back in your pockets to help,” California Governor Gavin Newsom, a Democrat, said in a statement.

“We’re sending back more than a thousand dollars to help families pay for everything from groceries to gas,” he said.

Who is eligible for a refund?

To be eligible for a payment, you must meet certain requirements.

You must have been a California resident for six months or more in the 2020 tax year and be a current resident of the state.

California Governor Gavin Newsom and Mayor Libby Schaff of Oakland, California, at a press conference May 10, 2021 in Oakland.

Justin Sullivan | Getty Images News | Getty Images

You must have filed your 2020 income tax return before October 15, 2021 and adjusted your gross income within the required thresholds.

In addition, you must not have been claimed as dependents by someone else.

How much money do I get?

Payments for eligible couples applying jointly can range from $400 to $1,050.

Eligible individuals can receive $200 to $700.

The amount of the checks depends on two factors: income and number of next of kin.

The most generous amount — $1,050 — goes to married couples who have combined incomes of $150,000 or less and one dependent. A couple in that income bracket will receive $700 if they have no dependents.

When do the checks go out?

Payments will be made between this month and January.

Direct deposits are sent to residents who have filed their 2020 state return electronically and received a refund from the state via direct deposit. About 90% of direct deposits are expected to be issued in October, as of Friday.

Other payments will be made later this month on debit cards sent by post.

Will the payments cause inflation?

States have record surpluses and many people are struggling with extremely high inflation.

Jared Walczak

vice president of state projects at the Tax Foundation

While states have introduced one-time payments throughout the year, there has been an uptick as Election Day approaches, noted Jared Walczak, vice president of state projects at the Tax Foundation.

“States have record surpluses and many people are struggling with extremely high inflation,” Walczak said.

That prompts policymakers to merge the two and write checks.

“Unfortunately, that only fuels further inflation by injecting more money into an overheated economy,” Walczak said.

Tax cuts would be a better alternative for extra income in the long run, he said. If states look at one-time money instead, it might be better spent on one-time needs, such as retirement or rainy-day funds, he said.

The Valley Voice
The Valley Voice
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.


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