Relief Checks: summary news 23 December
US Inflation Relief: Latest Updates
Headlines: Friday, 23 December 2022
- Date set for Supreme Court to hear two challenges to Biden student loan forgiveness plan
- Inflation increased 0.1 percent in November & 7.1 percent year-over-year boost in prices.
- Federal Reserve continues to push up rates as inflation begins to slow
- Workplace fatalities increased by almost nine percent from 2020 to 2021
- Thousands of workers will see a raise thanks to increases in the minimum wage that take effect in 2023
Government shutdown averted
Congress has passed a bill to fund the government through 30 September, averting a government shutdown.
The major spending bill is over 4,000 pages long and includes financial funding for dozens of government programs, as well as a renewed aid package for Ukraine.
While the bill does not include any funding for direct relief for the country's residents to combat inflation, it does change the Electoral Count Act. These alterations will make overturning federal election results more difficult by making the role of the Vice President in the certification process ceremonial.
Wells Fargo has settled consumer abuse claims with authorities for $3.7 billion related to car loans, mortgages, and checking and savings accounts.
For some clients, the bank’s misconduct had extremely serious repercussions, according to the Consumer Financial Protection Bureau.
According to the CFPB’s ruling, Wells Fargo improperly seized vehicles from their owners and caused borrowers to lose their homes. In addition, overdraft fees on the bank accounts of other customers were incorrectly assessed.
Read our full coverage to see if you are eligible to receive a payment from Wells Fargo.
Mortgage rates plateau after another round of increases from the Fed
A year ago, the housing market was on fire, with far more buyers than affordable properties available. This led prices way up, and with historically low-interest rates for mortgages, many could lock in an affordable monthly payment. However, with the Federal Reserve moving its base rate up, the mortgage market has followed, pricing some would-be buyers out of the market, leading to a cooldown in many areas.
After the most recent rate hikes were announced just over a week ago, the rate for a thirty-year mortgage has continued to fall, but those for 15-year loans have been driven up slightly. We will continue to follow these trends as further announcements from the central bank come.
Last month the Social Security Administration (SSA) announced an historic increase for beneficiaries, reflecting the damaging effects that covid-19 has had on the economy. Each year the SSA implements a cost-of-living adjustment (COLA), which is designed to increase benefits in line with inflation.
Starting in January 2023, an 8.7 percent increase will be applied to monthly payments surpassing last year’s 5.9 percent bump.
How much you receive is based upon the severity of an injury as well as the number of dependents.
What are some of the biggest changes?
Automatic enrollment would begin from 2025 and workers would contribute up to ten percent of their earnings.
Workers earning less than $71,000 per a year would receive a 50 percent top up to $2,000 from the federal government.
Measures will be introduced to help Americans who need money taken out from the savings pot at short notice and also those with no savings. Provided one withdrawal a year of $1,000 was repaid there would be no penalty charges. In terms of emergency savings employers will be able to offer low-paid employees a savings account thast uses 3% of their salary, capped at $2,500.
The most well known change to the 401k retirement plan at this stage is the increase of the contribtution limits.
The IRS will increase the contribution limit by $2,000 to $22,500 for 2023. Workers who are saving for retirement with 401(k), 403(b), most 457 plans, and the Thrift Savings Plan can contribute up to $22,500 to those plans in 2023.
However, it isn’t just the contributions limits that are increasing. Plans inside the latest yearly spending bill for 2023 set to make a few key changes to the retirement plan that look set to make it easier for workers to save money for their future life.
VA provides benefits for disability ratings that have been in force for a specified amount of time. Furthermore, your VA disability rating may become permanent in select instances. VA may terminate or modify a veteran’s disability rating based on particular findings unless these regulatory safeguards kick in or your ratings become permanent.
Therefore, the US Department of Veterans Affairs (VA) will need you to undergo an assessment to establish if your service-connected condition still requires a specific disability rating.
VA may lower a veteran’s disability rating if it determines that their health has improved.
Student loan forgiveness - when could it happen?
American students will likely find out the result of the student debt cancellation plan in Spring as the Supreme Court has announced when it is to hear arguments relating to the case.
The nine court justices will hear arguments on 28 February from six Republican states that are challenging the forgiveness as well as two plaintiffs who are not set for any of their debt to be written off. One of these plaintiffs had more than $45,000 of his debt cancelled by the Paycheck Protection Program.
Come January, workers in two dozen states that get paid the minimum wage will see a raise. Three others and the District of Columbia will follow suit later in 2023.
Three states will raise their minimum wage to $15 or more joining California and the District of Columbia as well as a handful of municipalities that have already mandated the sought for level. That amount is more than twice the federal minimum wage of $7.25 per hour which has been in place since the summer of 2009.
Minimum wage in Texas
Wondering why Texas' minimum wage appears to be trending on social media right now? The state minimum wage rate in Texas is $7.25 per hour - the same as the current Federal Minimum Wage rate. The minimum wage applies to most employees in Texas, with limited exceptions including tipped employees, some student workers, and other exempt occupations.
The minimum wage in Texas was last amended in July 2008, when it was raised $0.70 from $6.55 to $7.25. According to the most recent data, 78,000 workers in Texas earned the federal minimum wage of $7.25 per hour in 2017 while 118,000 earned even less.
/cloudfront-eu-central-1.images.arcpublishing.com/diarioas/UAN5RE5OPBFCXDKCJIUHQQMJWI.jpg)
The Social Security Administration in the United States released the greatest cost-of-living increase in more than four decades. With an annual rate of 8.7 percent, this historic COLA will significantly increase the maximum Social Security payout.
The maximum is determined by the age of retirement. The maximum payment in 2022 for individuals who retired at their full retirement age was $3,345; those who retired at sixty-two saw a maximum of $2,364; and those who retired at seventy had a maximum benefit of $4,194 per month.
Saver’s Credit for low- and moderate-income workers
Low- and moderate-income workers are being encouraged to start saving for retirement now and possibly earn a special tax credit in 2022 and years ahead. The Retirement Savings Contributions Credit, also known as the Saver's Credit, helps offset part of the first $2,000 workers voluntarily contribute to Individual Retirement Arrangements, 401(k) plans and similar workplace retirement programs.
Eligible workers still have time to make qualifying retirement contributions and get the Saver's Credit on their 2022 tax return. People have until Tuesday 18 April 2023 - the due date for filing their 2022 return - to set up a new IRA or add money to an existing IRA for 2022. Both Roth and traditional IRAs qualify.
More information on the Saver's Credit is available on the IRS website.
New changes for tax filing in 2023
There will be some changes in the next tax filing season.
The standard deduction for married couples filing jointly for tax year 2023 rises to $27,700 up $1,800 from the prior year. For single taxpayers and married individuals filing separately, the standard deduction rises to $13,850 for 2023, up $900, and for heads of households, the standard deduction will be $20,800 for tax year 2023, up $1,400 from the amount for tax year 2022.
Some tax credits return to 2019 levels. This means that affected taxpayers will likely receive a significantly smaller refund compared with the previous tax year. Changes include amounts for the Child Tax Credit (CTC), Earned Income Tax Credit (EITC) and Child and Dependent Care Credit.
Those who got $3,600 per dependent in 2021 for the CTC will, if eligible, get $2,000 for the 2022 tax year. For the EITC, eligible taxpayers with no children who received roughly $1,500 in 2021 will now get $500 in 2022. The Child and Dependent Care Credit returns to a maximum of $2,100 in 2022 instead of $8,000 in 2021.
Good morning and welcome to AS USA
You join us for news on the state of the US economy on Christmas Eve-Eve.