Inflation Relief Payments: What You Need To Know for 2023
For the second year in a row, the federal government has no plans to issue stimulus checks in 2023. A fourth round of payments — this time for inflation relief — would require an act of Congress. If lawmakers couldn’t pass stimulus legislation in 2022, the smart money would be against a divided government getting it done this year — particularly since the inflation rate is now falling.
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Even so, millions of Americans are looking forward to stimulus payments or tax credits that their individual states are issuing to ease the burden of inflation. Depending on variables like where you live, what you earn, what you paid in taxes and whether you own a home, you could have a check coming your way in the coming weeks and months.
On top of that, the Inflation Reduction Act of 2022 will lower some costs and deliver some tax credits in 2023, although it doesn’t authorize direct stimulus payments. Here’s what you need to know.
Payments Are Still Trickling Into Several States
Six states are still issuing payments that are set to arrive in the coming months.
Alaska
Alaska’s Permanent Dividend Fund (PDF) pays most residents an annual check from a portion of the state’s oil revenues. While the fund isn’t directly tied to inflation, PDF payouts rose in 2022, right along with the prices Alaskans paid in stores.
Last year, payments jumped to $3,284 from $1,114 the year before, thanks to increases in the price of oil. The final amount included a $650 energy relief payment. It’s unclear if 2023’s PDF will be padded with another inflation-relief provision, but Alaska will pay unclaimed 2022 PDFs through March.
California
Most eligible Californians received inflation relief checks worth up to $1,050 in 2022, but the state will continue sending out the remaining Middle Class Tax Refund payments through mid-January. So far, California has paid out $8,793,299,700 to 30,612,921 families through 7,020,930 direct deposit payments and 9,112,953 debit cards.
Colorado
Colorado residents who filed their tax returns by June 30 received their $750 Colorado Cash Back payment in 2022 — $1,500 for couples. Those who filed by the Oct. 17 deadline extension will receive their payments by January 31.
Your payment is based either on your returns or the Property Tax/Rent/Heat Credit (PTC) Rebate application you filed in 2021.
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Idaho
The Idaho Tax Commission expects to send 800,000 rebates worth $500 million to residents across the state by March 2023. The rebate, authorized through a special legislative session in September 2022, gives $300 to individuals and $600 to couples or 10% of the taxpayer’s income taxes for 2020, whichever is greater.
The state is sending out 75,000 payments a week to every Idaho citizen who lived there full-time in 2020 and 2021 and filed returns for both years.
New Jersey
Homeowners eligible for New Jersey’s ANCHOR program can expect checks worth up to $1,500. The property tax rebate applies to residents who owned a home in 2019, but the benefits also extend to renters, who are eligible to receive up to $450.
The program will accept applications through Jan. 31 and payments will be issued in late spring.
South Carolina
South Carolinians are eligible to receive up to $800 in inflation stimulus. If their 2021 tax liability was less than $800, they’ll receive that amount.
Those who filed their 2021 returns by Oct. 17, 2022, received payment by Dec. 31. If you missed the deadline, don’t worry. Those who file by Feb. 15 are eligible for a second round of payments to be distributed in March.
Old Stimulus Is Still on the Table and New Tax Credits Are Coming
If you still haven’t received a pandemic-era stimulus payment for which you were eligible, it’s not too late to claim it in 2023. You’ll have to file a tax return for 2020 or 2021, depending on which payment you missed, but the IRS typically gives you three years to file a late return and claim any credits that you’re owed from that tax year.
The Inflation Reduction Act of 2022 brings new tax credits and deductions for 2023 that could affect you, your business and your favorite nonprofit. Most of them deal with clean vehicles, energy-efficient home upgrades and alternative fuels.
Among the most lucrative incentives are $14,000 in direct consumer rebates for families that install energy-efficient appliances like heat pumps in their homes, and a 30% tax credit for solar panels that averages savings of $9,000.
The Inflation Reduction Act Will Lower Some Healthcare Costs
Last year’s legislation also includes provisions that could lower your healthcare bills in 2023. The 50 million Americans enrolled in Medicare Part D will now have their pharmacy costs capped at $2,000 per year.
The Biden administration estimates that 1.4 million Americans will enjoy cost savings. Another major provision limits insulin costs to $35 per month, which the administration says will benefit 3.5 million Medicare recipients.
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This article originally appeared on GOBankingRates.com: Inflation Relief Payments: What You Need To Know for 2023
