Relief checks | Summary news 10 April 2023
Headlines: Monday 10 April, 2023
- US added 236,000 jobs in March, leading to a small decrease in the unemployment rate to 3.5%
- Payroll in theretail sector has fallen by 15,000 workers over the last year
- Weekly first-time jobless claims drop 18,000 to 228,000
- Jobs openings decreased in February, still 1.7 jobs for every unemployed worker
- Over 3 million layoffs in the US this year, which sectors have seen the highest job cuts?
- Social Security and Medicare Trustees warn of respective funds depleted by 2031 and 2033
- Various states will continue to issueinflation relief checks and generous tax refunds in April
- Social Security April payment schedule: when can you expect your payment?
- No Supplemental Security Income checks will be sent in April;instead, the April payment was made on 31 March
- IRS offers a tax credit to filers with dependents in other countries
Read more from AS USA:
Barring a recession, Fed unlikely to cut interest rates
The US economy, while it is beginning to see some headwinds, keeps showing its resilience in the face of rate hikes from the Federal Reserve. Last month, 236,000 new jobs were added, slightly less than predicted but still strong. And wages grew at a slower but robust pace of 3.2%. Meanwhile, inflation is still more than double the policy target of 2% for the central bank.
While Mark Zandi, chief economist of Moody's Analytics, is forecasting that inflation will moderate, it won’t be until this time next year that it drops to where the Fed would feel comfortable with it. In his opinion, he would be “very surprised” if policymakers began cutting rates in the second half of this year. With the strength of the US economy, the bar is “very high” for the Fed to cut interest rates. A recession would be necessary with numerous job losses coming rapidly.
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Outstanding debts of all kinds can negatively impact your credit score hurting your chances of getting a loan, pushing up the interest rate you pay, being able to buy or rent a house and more. That can cause harmful stress, which can aggravate ill health.
That’s why measures are being taken tokeep medical debt from affecting your credit score so that recovering from an illness isn’t made harder by debt incurred to get treated.
In the United States, 41.2 million or twelve percent of people depend on Supplemental Nutritional Assistance Program (SNAP) benefits, previously known as food stamps.
In late 2022, the US Department of Agriculture (USDA) announced that some beneficiaries had seen the value of the pre-paid debit cards distributed as a part of SNAP stolen by scammers. The exact scale of this fraud remains unknown, but the fact that vulnerable people have seen much-needed benefits stolen and, to this point, left without few options is extremely concerning.
Read our full coverage for details on how the benefits are being stolen and which states are offering relief to these victims.
Prediction on gas prices
Expect the upward trend to continue through much of the rest of spring, but once the transition to summer gasoline and refinery maintenance are behind us, April and May jumps could bring June slumps.
However, for diesel, the news continues to be good, with the national average price of diesel continuing to drop, now at its narrowest difference to gasoline in over 13 months.
Gas prices rising across the US, expected to continue through spring
Gas prices in the US are continuing to rise, 8.8 cents since last week, as the weather warms and Americans take to the road. Additionally, OPEC nations announced a surprise reduction in production last week. According to GasBuddy data the average price of gasoline has jumped to $3.57 per gallon. However, it is over 50 cents per gallon cheaper than a year ago.
The upward trend is expected continue through the spring before tapering off in the summer months with cheaper blends available and refining capacity coming back online.
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The Internal Revenue Service (IRS) hopes to rake in an extra $100 billion in revenue over the next ten-years. It aims to do this by increasing auditing levels to ensure taxpayers are not hiding their money from the federal government. Understandably, poorer Americans are worried about prying eyes into their finances, while ignoring the country’s richest.
However, the new head of the organisation has made it clear that Americans at an average salary will not be targeted,while those earning substantially more will be.
Taxpayers in certain counties in Tennessee join the list of filers who have been granted tax deadline extensions due to severe weather events from coast to coast. Here's a look at the other taxpayers the IRS has given more time to submit paperwork and pay certain taxes this season.
The 2023 Tax Season will wrap up for most US taxpayers on Tuesday 18 April 2023. That is the deadline to submit 2022 income tax returns. However, due to extreme weather events some filers have been granted an automatic extension. Those that cannot make the deadline must apply for an extension by that date, which will give them another six months until 16 October.
But unless you are in one of the disaster declaration areas that received an automatic extension from the IRS, you’ll still be on the hook for any money they may owe. You need to pay any balance due, to the best of your knowledge, that you owe by Tax Day.
Missing the tax deadline and filing your tax return late can be an expensive proposition if you owe money to Uncle Sam. You could face penalties for filing late as well as late payment penalties and interest to boot.
The Internal Revenue Service opened the window to start filing income tax declarations for the 2023 tax season on 13 January this year and began processing returns ten days later. The deadline to turn in a 2022 income tax return is Tuesday 18 April for most US taxpayers, but for some who were affected by severe weather events, they have received an automatic extension.
Any taxpayer who is not covered by one of those disaster declarations and thinks they will need more time, will need to apply for an extension from the IRS.
Social Security disability payments vary for each individual and are calculated in a similar fashion to retirement benefits. The SSA looks at your earnings during the years from the time you turn 22 up to the year before you become disabled. The criteria for being disabled in the eyes of the SSA are quite strict.
SSDI payments are only taxed if you are receiving enough to be over a threshold of $25,000. The vast majority of recipients do not receive that much support.
The IRS offers a tax credit for buying an electric vehicle as an incentive to promote the use of more energy-efficient vehicles and lessen reliance on fossil fuels. Electric cars produce zero emissions, which helps to reduce air pollution.
If you bought a plug-in electric or fuel cell vehicle this year, you may be eligible fora clean vehicle tax credit of up to $7,500.
Get EITC and other tax credits with free tax help
If you are eligible to receive Earned Income Tax Credit, you may also avail of free assistance in filing your tax return.
The IRS's Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs offer free basic tax return preparation to qualified individuals.
VITA sites offer free tax help to people who need assistance in preparing their own tax returns, including people who make $60,000 or less, persons with disabilities, and limited English-speaking taxpayers.
The TCE program offers free tax help, particularly for those who are 60 years of age and older, specializing in questions about pensions and retirement-related issues unique to seniors.
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Unlucky if you hoped you could claim this, but under no circumstance can a spouse be claimed as a dependent, even if they have no income. Furthermore, the Tax Cuts and Jobs Act of 2017 eliminated personal exemptions for tax years 2018 through 2025.
Married taxpayers cannot use the Head of Household status in the event that their spouse doesn’t work. In order to file a tax return as a Head of Household you must be unmarried or considered unmarried along with having a dependent child.
If you dream of owning a home in sunny California, it may be a good time to buy one, since prices have been going down in recent months.
House values are still steep, but as our report indicates, in some cities, the price drop has been significant.
IRS urges taxpayers to file returns electronically
The IRS is encouraging taxpayers to avoid filing returns on paper. They suggest choosing from four ways to file electronically:
-IRS Free File or fillable forms
-Free tax return preparation sites
-Commercial software
-Authorised e-file provider
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The announcement of major layoffs from large corporations, coupled with the various bank collapses seen over the last six months, has generated a level of economic uncertainty in the US economy not seen in over a decade.
Such conditions create challenges in evaluating the impact of the Federal Reserve’s rate increases on the economy broadly and the labor market specifically.
As the labor market shows signs of softening, Maite Knorr-Evans tells us about the impact on workers and their wages.
7 out of 10 Americans say the economy is not in positive shape- CNN poll
According to a poll by CNN, the Americans’ view of the economy has improved, but only 29% of them say the country’s economy is in good health.
Around half of those surveyed say that their personal financial situation is worse than it was a year ago. The poll also shows that people are not optimistic that the economy will recover in the next year.
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The federal funds rate is the interest rate at which banks and other depository institutions lend money to each other, usually on an overnight basis, to meet their reserve requirements.
The federal funds rate’s impact can be felt by consumers in various ways. Changes can have an effect on consumer loans, mortgages, and credit cards. As our coverage indicates, the rate can affect people’s ability to borrow, save, find work, and manage their expenses.
Study: The middle class has been getting smaller
The middle class was once a symbol of the American dream, representing opportunities for a better future. But that portrait looks quite different today. Some middle-income households and experts believe a lack of supporting policies might be to blame for the drastic changes, according to CNBC.
Lawrence Mishel, a fellow at the Economic Policy Institute, says, “It’s not that the economy got worse, it was that there were policy decisions made so that the economic growth did not filter down to the vast majority.”
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Welcome to AS USA
We hope you enjoyed your Easter, Passover, or Ramadan weekend.
Time to get your teeth back into some finance news.