To the tune of trillions of dollars, the coronavirus epidemic provided enormous stimulus to American firms and labor. Stimulus payments arrived in waves, and as the epidemic grew worse, it looked as though the government would keep printing money indefinitely to save the economy.
Even with broad mask bans and travel restrictions in place, the American economy recovered quickly and sharply. In early 2022, inflation surged to heights not seen in decades, thanks to trillions of dollars in stimulus money in the economy.
What does this mean for the spring 2022 stimulus payments?
The Federal Stimulus Is Almost Certainly Over
The US government put $5 trillion in stimulus money into the economy from March 2020 to February 2022. Approximately $1.8 trillion went to people and families, with another $1.7 trillion going to companies.
The federal government’s desire for additional direct stimulus, on the other hand, is dwindling. The Biden administration appears to be largely focused on infrastructure investment,
but many economists warn that more stimulus would merely exacerbate inflation, which reached an all-time high of 8.5 percent in March 2022. The federal stimulus will most likely be on hold, if not totally terminated until this trend reverses.
However, there is always a ray of hope
Although the economy is growing in certain areas, the unemployment rate is still higher than it was before the epidemic, and other benefits, such as the extended child tax credit, have expired.
The fact is that many Americans continue to struggle. Against this context, a slew of new stimulus measures has been floated, ranging from a fourth stimulus check to recurrent $2,000 monthly payments.
If the economy falters again, or if a new coronavirus variation causes an increase in hospitalizations and fatalities, the need for further stimulus may get stronger.
State Stimulus Packages are still going strong
Despite the fact that the federal government appears to be out of the stimulus business, for the time being, several states have taken up the ball and are moving on with their own stimulus plans.
Although not all will be accepted, these are some of the initiatives that certain states are pursuing to help their inhabitants.
California has had a budget surplus for the previous two years, which has helped citizens. The state sent two rounds of direct stimulus cheques to citizens in 2021 and early 2022, while Gov. Gavin Newsom has suggested issuing $400 debit cards to assist offset rising gas prices in 2022.
Residents would receive one card for each automobile they own, up to a maximum of two ($800) per family, with payments beginning in July.
Democrats in Illinois are proposing $100 stimulus cheques for adults and $50 handouts for children that would be in residents’ mailboxes by September.
The package also includes up to $300 in property tax relief checks, a six-month moratorium on food and gas tax hikes, and a ten-day freeze on school supply levies in August.
Idaho residents will get refund checks or direct transfers for the greater of 12% of their 2020 taxes or $75.
Janet Mills, Maine’s governor, has suggested delivering $850 stimulus cheques to citizens of the state. The funds will come from a $682 million state surplus.
New Mexico (NM)
Residents of New Mexico who file combined returns and earn less than $150,000 will receive a $500 tax rebate. A $250 rebate is available to single filers with earnings under $75,000.
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Other credits include a $1,000 credit for full-time hospital nurses, a $175 refundable child tax credit, a three-year partial income tax exemption for military retirees, and an extension of the solar market tax credit, which is equivalent to 10% of qualified purchase and installation expenses.
Indiana senators authorized an extension of the state’s $125 stimulus payments to citizens, bringing the total number of people eligible to approximately 450,000.
Georgia Governor Brian Kemp just signed stimulus payments into law. Single taxpayers (or married filing separately) would get $250, heads of household $375, and joint filers $500 in one-time refunds.
New Jersey (NJ)
In an effort to accommodate illegal immigrants, New Jersey Governor Phil Murphy has suggested delivering $500 stimulus funds to low-income taxpayers who filed using a tax identification number rather than a Social Security number.
Virginia legislators are debating the specifics of a possible $300 stimulus package for every taxpayer in the state. Two additional proposals suggest lowering or eliminating the state’s food tax, as well as suspending the state’s 26.2-cent gas tax for a year.
Kathy Hochul, the governor of New York, has suggested a property tax credit ranging from $425 to $970 for low- and middle-income families in the state.
The state is also suspending the state tax on motor fuels until December, in addition to other initiatives such as tax relief for enterprises.
Gov. David Ige suggested a $100 tax rebate for all taxpayers and dependents in January. The Hawaii House Committee on Finance raised the stakes in April, authorizing $300 payouts for taxpayers earning less than $100,000 and $100 checks for those earning more.