California's middleclass tax rebate program will see eligible residents receive hundreds of dollars to help them cope with rising product prices. The state has some of the highest gas taxes in the country. Let’s take a look at who’s eligible for California’s tax rebate and how much you can expect.
Inflation has left many families struggling to put food on the table, especially seniors relying on social security benefits. With no additional stimulus checks coming from Washington, states have stepped in with their own programs to help households experiencing financial hardship.
California’s middle class tax rebate, explained
After months of negotiations, California governor Gavin Newsom and the state legislature have reached a deal on relief funds. The state will send out checks to residents to offset high gas and food prices. The state plans to spend nearly $10 billion on the relief program, with the funds coming from its budget surplus of $97 billion.
Who's eligible for California’s middleclass tax rebate?
The rebate program is geared toward helping 23 million residents. As California's gas tax rate is more than 50 percent, the governor initially proposed a $400 gas rebate for drivers. However, the proposal lacked enough support in the legislature and a compromise was reached. Instead of offering a rebate to everyone, the statehouse and legislature agreed to provide economic relief to low-income taxpayers.
How much can you expect from California’s tax rebate?
California’s tax rebate program is designed so that the less you make, the more you’ll get. Therefore, a couple earning less than $150,000 and with one child would get $1,050 combined.
A single person making less than $75,000 per year will get $350, and there's an extra $350 for dependents. The payment drops to $250 for a single person making less than $125,000, and $200 for single people making more than that, to a maximum of $250,000. A couple making less than $250,000 and with a single child would receive $750, and a couple making $500,000 with one child would get $600. The relief package also includes a diesel sales tax holiday.
What can you do with California’s tax rebate?
The tax rebate is meant to help residents afford food and gas. However, you could spend the money however you wish, such as paying rent or reducing your student loan debt.