Governors In These States Want To Give Residents Cash Thanks To Unexpected Budget Surpluses

Topline

Growing tax revenue has led several states to consider giving hundreds of dollars back to most residents this year, while other states will dole out their surplus funds through automatic tax rebates–here are the states that could respond to unexpected budget windfalls by handing out cash.

Millions of Americans could be getting cash back from their states’ budget surpluses.

getty

Key Facts

Wisconsin Gov. Tony Evers (D) announced a plan Thursday to disperse $150 to every resident out of the state’s unexpectedly high budget surplus, though it wasn’t immediately clear if the state’s GOP-controlled legislature will back the plan.

In neighboring Minnesota, Gov. Tim Walz (D) has proposed sending up to $350 to every taxpayer earning $164,400 or less, while giving front-line workers who remained on the job during the past year $1,500 checks.

Georgia Gov. Brian Kemp (R) wants to use the state’s budget surplus to give $250 in tax refunds to single filers and $500 to joint filers.

Kansas Gov. Laura Kelly (D) said last month the state should send $250 back to all single filers who filled out a tax return in 2021, with joint filers getting $500, but leaders of the GOP-controlled Kansas legislature have expressed skepticism of the governor’s intentions since she’s up for reelection this year.

In Idaho, which has a nearly $2 billion projected surplus, lawmakers in the state House last week overwhelmingly approved a sweeping tax cut bill giving each resident either $75 or a rebate equal to 12% of their 2020 state income tax bill, whichever is greater.

Residents of Oregon, Indiana and Colorado will all get a piece of their states’ budget surpluses due to laws mandating automatic refunds: Oregonians will be the big winners, with the average taxpayer expected to get a refund of $850, while Indiana residents should receive about $170 back and Coloradans will get about $69.

What To Watch For

California is grappling with a massive $31 billion estimated surplus for 2022, and Gov. Gavin Newsom (D) has said it’s possible some of the money could be given directly back to taxpayers through rebates.

Key Background

States across the country have generally seen their budget surpluses grow due to spikes in tax revenue over the past year, fueled by a red-hot economy and strong consumer spending habits, according to a Pew analysis. State coffers have also received an influx in federal funding from Covid-19 relief packages. Governors who have proposed direct payments to taxpayers largely argue the refunds could relieve economic hardship from the Covid-19 pandemic and inflation. The rate of inflation in the U.S. is around a 40-year high and shows no major signs of slowing down, with prices for products like gasoline and meat skyrocketing over the past year, a trend some economists think is linked to the trillions of dollars in stimulus money that poured into the economy earlier in the pandemic. For many states, this marks the second year in a row when economic conditions have led to large budget surpluses, and several also ran tax rebate programs last year. California, for instance, used its surplus to fund a project called the Golden State Stimulus, which sent $600 checks to all taxpayers earning $75,000 or less.

Tangent

The Internal Revenue Service started accepting federal tax returns on Monday. Americans have until April 18 to file their tax returns.

Topline

Key Facts

What To Watch For

Key Background

Tangent

Further Reading