Personal finance and money news | Summary for 28 February

US markets stung by war in Europe

Investors have been on a bad run since the turn of the year as markets have seen continued volatility. February was no exception with the broad-market S&P 500 dipping into its first 10% correction in almost two years as Russia invaded Ukraine.

Social Security fraud

Sonia Pimentel, 43, was arraigned on a federal indictment charging her with bank fraud, theft of public funds, and aggravated identity theft.

It is alleged in charging documents that Pimentel fraudulently collected SSI monthly payments from December 2011 through October 2016 by falsely representing herself as custodial parent for a child that did not live with her, and falsely representing to the Social Security Administration (SSA) that she had spent the SSI payments for that child’s care and support.

It is alleged that Pimentel opened a bank account in the child’s name, directed the SSA to deposit the SSI benefits to that bank account, and then withdrew approximately $42,346.73 for her own personal use.

Social security offices reopen

The covid pandemic has presented older Americans with plenty of grim news, from staffing shortages in long-term care and hospices to the punishing effects of loneliness and isolation. But there have been encouraging developments too — the kind of incremental progress that can take years to achieve, as lawsuits wend their way through courts, bills die in state legislatures and rise again, and the pandemic complicates everything.

The results are not always dramatic, but they can improve lives and health for older people, especially those with low income.

Paula Span reports on three: new right to appeal Medicare decisions, California easing of Medicaid qualifications and the reopening of Social Security offices.

No Child Tax Credit... get a loan!

This advert for a personal loan to allow you to start a family has hit home the current situation in the US since the ending of the enhanced Child Tax Credit.

The simple message from the finance company is that its ok to go into debt for a new member of the family.

Build Back Better has very little chance of coming law

With much of the world's attention drawn to Ukraine, very little news has been released on the Build Back Better bill which basically fell apart in December 2021. In January, some momentum began to build with Democrats considering a break up of the package to give some of the measures a better chance at passing. However, over the last few weeks no such bills have been introduced. Environmental activists have criticized Congress for failing to pass any major climate change related bill while Demcrats hold a majority.

Still waiting for your 2020 tax return to be processed, the IRS has some advice

The IRS is experiencing a historic processing backlog going into the 2022 tax season. National Taxpayer Advocate Erin Collins recently told members of the Senate Finance Committee that agency still hasn't processed 23.5 million 2020 tax returns from individuals and businesses.

If your 2020 tax return hasn't been processed yet, you can still file your 2021, but be sure to have all the necessary paperwork you need to submit an accurate return.

Ruble continues to plummet in response to sanctions on Russia

The Russian ruble continued it fall on Monday losing 30 percent of its value. The steep decrease came after the West imposed sanctions on the country for Vladimir Putin's decision to invade Ukraine.

In an attempt to prop up the nation's currency the central bank of Russia more than doubled interest rates to 20 percent. The stock market didn't open on Monday with trading frozen while Putin and his economic advisors met.

Dropping the gas tax might make inflation worse

Politicians are looking for a quick fix to the pain at the pump drivers are experiencing as the price of gasoline continues to rise. Russia's invasion of Ukraine and the ecnonmic sanctions won't help the matter either. 

Lawmakers have proposed suppending the gas tax as a way of providing relief to consumers. However, Alex Muresianu at the Tax Foundation argues that would be the wrong move. Revenue from the tax goes toward paying for highway repairs and is an efficient funding source for said purpose, those who use the roads pay for them.

Removing the tax who create a shortfall in funding for making those repairs costing more in the longrun. Not to mention it would cause more inflationary pressure in the economy acting like a small stimulus package.

An overview of the job market across the US

The national job openings rate was 6.8 percent in December 2021 with Alaska having the highest rate at 9.3 percent but also saw the highest rate of new hires at 5.8 percent.

The overall hire rate and number of job openings was little changed across the nation, openings increased in nine states and decreasing in six.

GOVERNMENT ASSISTANCE PROGRAMS

Do SNAP benefits expire? How can I cancel my SNAP benefits online?

The Supplemental Nutritional Assistance Program (SNAP), formerly known as Food Stamps, is one of several programs administered by the US Department of Agriculture’s Food and Nutrition Service agency. SNAP benefits are managed by each state’s public assistance agency and although similar, each state has its own rules.

Likewise, the name of the program and the state agency that recipients need to contact can vary depending on where you live. This can make it confusing for the over 41 million people across the United States who receive nutritional assistance through SNAP as of 2021. 

Here’s a lookat some of the basics when it comes to your benefits.

Sen. Rick Scott tax plan would mainly raise taxes on incomes under $100,000

Senator Rick Scott (R) of Florida has proposed changing tax laws so that "all Americans" owe some federal income tax  each year. Although he hasn't presented details of his plan the Tax Policy Center did some estimates based on what a policy like that which Scott is proposing. 

They found that it would primilary raise taxes for low- and middle-income househoulds. Those with incomes below $54,000 would shoulder 80 percent of the burden, while 97 percent of taxpayers with incomes under $100,000 would see their tax bill rise.

Using a $100 minimum tax model, they found that low-income families with children would would be hit the hardest and see their after-tax income drop by more than 20 percent, losing out on $5,000 of income.

Rouble hits all-time low

The rouble plunged to a record low on Monday and the dollar soared against most peers after Western nations announced fresh sanctions to punish Russia for its invasion of Ukraine, and President Vladimir Putin put its nuclear forces on high alert.

The rouble dropped to as low as 119 per dollar in early trading, tumbling beyond its previous low of 90 roubles per dollar. It was last at 109.

The declines came despite Russia's central bank announcing a slew of steps on Sunday to support domestic markets, after Western allies ratcheted up sanctions including blocking certain banks from the SWIFT international payments system. Restrictive measures on the Bank of Russia were also imposed to prevent it from deploying its international reserves to undermine sanctions.

MEDICARE

Does Medicare pay for assisted living?

Medicare covers a range of health services to beneficiaries in any living situation. However, like most health insurance plans, Medicare doesn’t pay for long-term care costs of residency at an assisted living facility or day-to-day custodial care.

Under specific circumstances, if a beneficiary requires a short-term stay for inpatient care in a skilled nursing facility that’s not merely custodial or long-term care, it may be covered by Medicare. Read more.

US NEWS

Which day of the week is the cheapest to put gas in your car?

Gas prices shift from day to day depending on the available supply relative to real or expected demand or consumption, even when the price of crude oil is stable. However, if there is a disruption, such as the fear of sanctions being imposed on Russian oil after it invaded Ukraine, gasoline prices can change rapidly.

This is bad news for consumers who have watched the upward march of gasoline prices since the end of the pandemic. That’s been the result of fuel supplies worldwide being tight as production is brought back online but not fast enough to meet surging demand. 

That trend is expected to continue for the near future but if you shop smartly, you can still save at the pumpby filling up on the right day.

How could Russia's invasion of Ukraine impact gas prices in the US?

Those in the US have been paying more at the pump than ever before.

So far, no sanctions have been imposed on Russian gas or oil, but if the US or allied countries make that move, prices could go up even further. Already the conflict is impacting the price of the barrel as some project that sanctions could lead to a global oil shortage and those concerns are sending a signal to the market.

In the case sanctions are imposed, other oil producing countries could increase supply, but they could also use the high price and our dependency to their advantage by keeping supply low. The United States could also tap into its strategic reserves, but President Biden already has to lower prices, but the move has had little impact thus far.

Today, 28 February, our team at AS USA will be bringing you all the latest news and information on tax season 2022, including information on IRS delays, the Child Tax Credit, and other benefits and credits that you should keep in mind when submitting your return.

Additionally, we will be tracking closely any impact that US sanctions on Russia could have on consumers here.