Millions of Americans will soon see more stimulus.
- The federal government has provided economic stimulus to many states.
- As a result, the state is running a budget surplus.
- Many are now giving money back to residents.
Americans hoping for a fourth round of stimulus from the federal government may receive it soon, but it won’t come directly from Washington.
Instead, this is what is happening. The U.S. Relief Plan Act, signed into law by President Joe Biden in March 2021, provided states with significant funding to combat the pandemic. This left the state with a huge budget surplus. And in many cases, the state returns this money to its residents. This is either because of existing laws or because local politicians passed new laws.
Here’s what you need to know about the stimulus package that will soon be sent to people’s bank accounts.
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Why are billions of dollars of stimulus being spent?
Because states receive so much money from the federal government, they have more money than they need to meet their budgetary obligations.
Some states have laws in place that actually require this money back. For example, in 1986, Massachusetts taxpayers passed Chapter 62F. Under this law, state tax revenues are directly related to wages and salaries. With surplus funds in excess of those costs, the Massachusetts taxpayer is expected to get her nearly $3 billion refund. The exact amount to be refunded will be determined when all 2021 returns are filed, but officials estimate the refund will be approximately 13% of state taxes paid.
Colorado residents will also receive stimulus money due to old laws on the books. The 1992 Taxpayer’s Bill of Rights (TABOR) Amendment entitles Colorado residents to this refund for their surplus, and residents receive an estimated $750 or $1,500 for joint filers. However, the governor has actually signed a new law to send this money ahead of schedule.
These existing laws are working in some states to help residents get stimulus money, while in others, surplus COVID-19 relief funds sent by the federal government is passing new legislation to provide financial assistance to residents using In Delaware, for example, the Delaware Relief Rebate Program, which pays residents $300, was enacted in his April.
More relief is on the way for many
With a multi-billion dollar bailout already underway, many Americans will soon get their voices heard for a fourth round of stimulus. And with so many federal grants remaining in states that haven’t yet taken action, it’s very likely that legislation will be passed soon.
So if you’re hoping for another stimulus payment from the federal government, there’s a good chance your wish will come true, even if it comes indirectly and is filtered by the states.