Two more states are sending free money as a recession looms

Financial experts and economists see a dangerous storm brewing thanks to a volatile combination of high inflation, rising interest rates and supply-chain issues.

And while the Federal Reserve is doing what it can to control inflation, its moves could be pushing the country closer to a recession.

Inflation hit a decades-long high of 9.1% in June, the S&P 500 fell into a bear market, and the U.S. economy shrunk for the second quarter in a row, usually a clear sign a recession has hit. The National Bureau of Economic Research still has to officially determine whether this is a recession or not.

What is clear is that American households are struggling and could use some extra support right now. Some experts are speculating that a coming recession could push the federal government to issue a new round of stimulus checks as they did during the pandemic and in past economic downturns.

And though the federal government hasn’t yet answered the call for more funding yet, several states are stepping in to provide money for residents.

Don’t miss

If your retirement plans have been thrown off by inflation, here’s a stress-free way to help you get back on track
Too many Americans are still missing out on cheaper car insurance
A TikToker paid off $17,000 in credit card debt by ‘cash stuffing’ — can it work for you?

State rebates

Many states have had historic surpluses over the past year thanks to inflation driving up prices of goods and high pandemic spending. Total state tax collections increased more than 17% in the fourth quarter of 2021 compared to the year before, according to the Tax Policy Center.

“Giving direct aid, direct payments is far more useful than doing income tax cards, or gas tax holidays,” says Lucy Dadayan, senior research associate at the Urban- Brookings Tax Policy Center.

Here’s a list of what states are offering. Make sure you don’t miss yours.

California

Gov. Gavin Newsom is the latest governor to [announce] rebates.

Millions of Californians will be getting a [rebate check of up to $1,050] to help offset the high cost of gas and other goods, known as the middle class tax rebate.

Single people making under $75,000 will get $350 and married couples making under $150,000 will get $700, if a couple has a dependent, that means they get an extra $350, which would total $1050.

Colorado

Coloradans will get $400 cash back this summer to help with the rising costs of gas, groceries and other items.

It will be delivered in the mail in August or September to anyone who filed their tax returns by the end of May 2022. About 3 million people should get the check.

Delaware

A relief rebate program was signed in Delaware in April. It’s a one-time payment of $300 per adult to help with the high cost of groceries and gas.

Checks should have been delivered by the end of May to people who filed their 2020 and 2021 taxes. The government says it’s working to make the payment available to those who didn’t file their taxes by the end of October.

You can check the status of your rebate here.

Florida

Families in Florida are getting a [one time payment of $450 per child] (https://www.flgov.com/2022/07/15/first-lady-casey-desantis-makes-major-announcements-to-support-the-hope-florida-a-pathway-to-prosperity-initiative/) for those eligible. That includes foster parents, caregivers, and families that are receiving money from the Florida Temporary Assistance for Needy Families program. Florida first lady Casey de Santis made the announcement in July. Nearly 60,000 families are expected to get the funds.

Georgia

People in Georgia are eligible for a rebate on their 2020 and 2021 taxes, thanks for a revenue surplus. Bill 1302 was signed into law in March.

Married couples can get up to $500 back, if you file jointly. Single filers can get up to $250 while people who file as head of household can get a maxim of $375.

Hawaii

The state government in Hawaii passed a bill giving tax filers a rebate of $300 if they make below $100,000 and $100 for filers who make above that threshold. The department of taxation says it’s still working on how to roll out the measure and hasn’t released any specifics yet.

Idaho

People in Idaho will get an email notifying them of their rebate. Full time residents who filed taxes in 2020-2021 are eligible.

The government is using two ways to calculate the amount, $75 or 12% of your 2020 Idaho state taxes, whichever is greater.

The tax commission says it will issue about 25,000 payments weekly, which can be expected through direct deposit of the mail. You can check the status of your rebate here.

Illinois

In Illinois direct rebate checks will be given to working families. Relief checks of $50 for individuals and $100 per dependent up to three children per family will be sent out at a cost of $685 million.

Indiana

The government in Indiana expects to give more than 4 million $125 checks to residents. thanks to a large state revenue, which grew 14%.

The Department of Revenue says money would start arriving in bank accounts in May and continue until mid-summer. You’re eligible if you filed a resident tax return for 2020 and 2021.

Kentucky

Tax filers in Kentucky will get rebates of up to $500 for single filers and $1,000 for joint filers. Additionally, Gov. Andy Beshear proposed a one-year reduction in the sales tax rate from 6% to 5%.

Maine

Residents in Maine are getting one of the highest relief payments in the country. Gov. Janet Mills signed the supplemental budget into law in April. It will see people get a one-time payment of $850 for inflation relief.

The money comes from the state’s surplus of $729.3 million. To be eligible for the payment, residents must file a tax return by the end of October 2022.

Single filers will have had a federal adjusted gross income of less than $100,000, $150,000 if filing as head of household or $200,000 for couples filing jointly.

Massachusetts

The Massachusetts Senate approved [$250 stimulus checks for taxpayers] (https://www.governing.com/finance/massachusetts-senate-approves-stimulus-checks-and-tax-relief). Single filers who earn between $38,000 and $100,000 can expect a one-time payment of $250, while married couples, who file jointly will receive $500. Payments are expected to begin in the fall.

New Jersey

Residents in New Jersey with at least one dependent child and a tax balance of $1 or more will get up to a $500, known as the Middle Class Rebate. Payments will be issued as a check separate from your tax return.

The Division of Taxation in New Jersey will begin mailing checks on July 2.

New Mexico

The state of New Mexico is bringing out financial relief in the form of $750 stimulus. to help with the rising cost of groceries and gas. Two laws were passed in the state providing a rebate and relief payment.

Depending on income, an eligible person will get two to three payments of $250. For families the payments will be $500.

Taxpayers should have received one of those payments either by direct deposit or check already. Another payment will be made later this summer. You can check the status of your return here.

Minnesota

The state of Minnesota passed legislation giving a one-time payment of $750 to front-line workers. Applications are open until July 22.

While Gov. Tim Walz is still trying to get legislators to pass off on sending rebate checks of $1,000 to Minnesotans to cover as the rising price of gas and food, that legislation hasn’t passed yet.

The proposed plan would see people who earn less than $165,000 get $1,000 and couples earning less than $275,00 would get $2,000.

Oregon

The Oregon Department of Revenue is issuing [one-time payments of $600] (https://www.oregon.gov/dor/programs/individuals/Pages/OneTimeAssistancePayments.aspx) to eligible households, meaning a single person, couple or family that live together. Eligible households qualified for the Oregon Earned Income Tax Credit (EITC) on their 2020 tax filing and lived in Oregon for the second half of 2020.

Virginia

Gov. Glen Youngkinn signed the budget this month that will see income tax refunds of up to $250 for individuals and $500 for married couples and eliminates the 1.5% state grocery tax.

Concerns have been raised that stimulus payments have contributed to inflation but Dadayan says that relief money wouldn’t have had as great an effect as supply chain issues, the war in Ukraine and gas prices.

Ivory Johnson, a certified financial planner and founder of Delancey Wealth Management, says stimulus spending goes further than helping the taxpayer, it can be a preventative measure for states.

“The states are doing that because they know either, ‘I send them money, or they file for unemployment, or they file for disability or they file for Medicaid.’ These are things that the state has to pay for,” Johnson says.

Pending stimulus spending

Several other states are considering tax breaks and have legislation pending, including:

New Hampshire

Legislators in New Hampshire have proposed a one-time rebate of $25 to vehicle owners registered in the state between July 2021 and June 2022 to help with fuel costs.

Kansas

Governor Laura Kelly made a budget amendment in April announcing a one-time $250 tax rebate to all Kansans who filed a 2020 tax return in 2021, costing a total of $460 million but it wasn’t finalized before the legislative session ended.

North Carolina

State senators proposed a one-time $200 payment to all licensed drivers in the state. The Gas Tax Rebate would be funded out of the state’s $1.3 million revenue surplus.

South Carolina

Two democratic legislators in South Carolina have proposed raising income tax 1% in the top marginal rate in order to fund $400 checks for individuals over 17 years of age every year.

Two more states are sending free money as a recession looms — is inflation relief headed your way?