Inflation Checks updates by state: California, Florida... | Student Loans, COLA... | Summary news 18 October
Headlines: 18 October 2022
- Key dates you may receive your inflation relief check in California
- Are Democrats regretting the $1,200 stimulus checks sent last year?
- Retirees receiving Social Security benefits could see on average $1,752 more in 2023 thanks to the COLA
- A record number of taxpayers requested an extension this year
- California to offer relief as drivers in the state pay more than $2.00 a gallon compared to those in other states
- A few states have moved to count the amount forgiven in student loans as taxable income
- The biggest COLA increases in US history
Costs for shelter are up 6.6 percent since last September
The Bureau of Labor Statistics released the September Consumer Price Index report earlier this month which showed a steep year over year in the cost of housing across the nation. The 6.6 percent increase represents the largest since 1982.
Food (11.2 percent) and energy resources (19.8 percent) also have seen substantial surges in price over the last year. With these three categories driving inflation, purchasing power across the country has decreased significantly.
BIden announces plans to decrease gas price
President Biden has announced two measures to bring down gas prices as OPEC plans to decrease production starting in November. The first move will be to increase withdrawals from the National Strategic Reserve to the tune of 12 million barrels. This will be tacked onto. the 180 million barrels that have been taken out since the spring.
Additionally, in order to encourage companies in the US to increase production, the federal government has offered to buy oil to refill the strategic reserve if production levels increase to bring prices to $70 a barrel. This is an extremely concerning proposition from a climate perseptive. If US companies are able willing to make the investments to produce that level of oil to bring down prices, it is unlikely that they would let the capital sit idoly once they have made the sell to the government.
The US Energy Information Administration (EIA) has published its winter fuel outlook for this year and it doesn’t make pretty reading.
Average costs are expected to increase by 28 percent from last year, or up to $931. Other fuels are having price increases, though not quite as drastic as that for gas.
Global gas prices have increased since the Russian invasion of Ukraine. The Russian government has stopped much of the export of natural gas to the European market in reaction to sanctions, pushing up its price.
The pandemic offered plenty of middle-class Americans the chance to reduce their credit card debt. Indeed, total credit card debt fell from nearly $1 trillion to $770 billion at the beginning of 2021. Since then this debt is back on the rise; it is up 13 percent compared to a year ago. The average household credit card debt is nearly $9,000 with a total of $887 billion in Q1 2022. It’s the fastest rise in more than 20 years.
Californians could see another direct payment next year
As gas prices in the Golden State continue to rise, contrary to other trends seen around the country, Gov. Newsom has proposed a windfall profits tax on oil and gas companies. The proposal would place an additional tax on revenue earned beyond what was seen last year. This tax would account for increased costs faced by customers, and the total accumulated by the state would then be redistributed to drivers.
Newsom's office released the plan after a report found that “California consumers paid $2.61 per gallon higher gas prices than the average US price as of October 4, 2022.” The office even accused oil refiners of slowing production to create shortages that drive up costs.
“Five refiners—Chevron, Marathon Petroleum, PBF Energy, Phillips 66 and Valero—make 97% of the state’s gasoline. They are in a position to restrict gasoline supply to drive up gas prices. They have consistently restricted supply and artificially driven up their prices significantly in excess of their costs.”
There is no word on when the legislature may vote on the bill, but many in the Golden State support the measure, as prices at the pump reach over $7/gallon in some areas. The divided created by the windfall profits tax could help families next year, but for many the relief could not come fast enough.
President Biden inspires student debt holders to apply for relief
Many following the White House's decision to forgive between $10,000 and $20,000 have criticized the fact that those who would like to see some or all of their debt wiped must apply.
President Biden has attempted to play down the actions that must be taken, explaining that the process should take no more than five minutes.
But this has not been enough for some debt relief activists who find it since the Department of Education has access to all of debt records and could cancel the associated amount automatically.
Households across the nation reeling from rising prices that receive Social Security benefits will get a big boost to their finances come the new year. The Social Security Administration announced its 2023 COLA and it was a whopper. At 8.7 percent, it is the fourth largest in the history of the annual cost-of-living adjustments and the biggest since 1981.
The average recipient of retired worker benefitswill see a monthly payment of $1,827 an increase of $146.
New York is another state that is offering support. Governor Kathy Hochul has ordered the one-time payment of $270 to taxpayers through the Additional New York State Child and Earned Income Tax Payment, which is part of the state’s budget for the fiscal year 2023.
According to official state figures, about 1.75 million New Yorkers of the almost 20 million residents are eligible for the average payment of $270.
US could suffer recession in 2022
A new report from economists at Fitch Ratings has suggested that the US may suffer a 1990-style recession from the start of next year, but the effects of such a slowdown are unlikely to be too long-lasting.
“The US recession we expect is quite mild,” the report read. “Fitch Ratings expects a very strong consumer balance sheet and the strongest labor market in decades to cushion the impact of a likely recession,”
This is a result of the Federal Reserve's decision to increase interest rates by 2 percentage points in 2022, bringing them to the highest levels in more than 10 years. This is designed to cool the rapid rate of inflation, but is also likely to bring down consumer spending and reduce the demand for mortgages.
California has begun issuing inflation relief payments. Golden Staters will receive the payment via direct deposit or debit card. The arrival of payments will be staggered depending on certain factors for each format.
Here’s when to expect them...
The soaring rate of inflation in the United States has caused chaos for consumers for much of the last year, forcing the Federal Reserve to take action to cool the economy. The Fed has raised interest rates significantly to slow the pace of price increase, but that has had significant consequences for homeowners.
President Biden announced the official launch of his administration’s Student Loan Relief Forgiveness application. The Beta version of the online form went live on Friday and borrowers flocked to get their requests in. Over 8 million Americans have already signed up to get their federal student loan debt canceled during the short trial period for the online portal.
The White House announced in August that Pell Grant recipients could get up to $20,000 discharged on their federal student loans, non-Pell Grant recipients as much as $10,000. The measure applies to individuals that made less than $125,000 and families that earned $250,000 in either 2020 or 2021, roughly 40 million borrowers.
President Biden has offered widespread student debt relief for more than 40 million Americans and the application process is now open.
But the relief will not come automatically and borrowers have until the end of 2023 to claim their support or miss out. Here’s everything you need to know…
Keeping one of his campaign promises President Biden announced in August that his administration would cancel up to $20,000 in federal student loan debt. It finally came after nearly two years from his inauguration with the delay due in part to working out the broad-based debt forgiveness.
While student loan forgiveness received from the Biden-Harris debt relief won’t be taxed federally,some that benefit could be liable for state taxes.
White House announces low-cost over-the-counter hearing aids rules in effect
Congress passed legislation in 2017 that required the Food and Drug Administration to create a category of over-the-counter hearing aids. However, it was never fully implemented. Instead, under a broad competition executive order signed by President Biden, the Health and Human Services Department was directed to "promote the wide availability of low-cost hearing aids."
The FDA approved the sale of over-the-counter hearing aids in August paving the way for their sale. As of Monday, major US retailors will begin selling lower-cost hearing aids without individuals needing a prescription or audiologist fitting adjustment.
The first payments for the Middle Class Tax Refund were sent out on October 7. People will of course be hoping to receive their money as soon as possible and fortunately the Californian Franchise Tax Board (CFTB)has published information for when people should receive their payment.
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Several US states have approved sending tax refunds or stimulus checks as relief from high prices.
These checks, some of which are going out in Republican-led states, come as many GOP leaders have tried to blame high inflation on stimulus checks Democrats passed in Congress in March 2021 through the American Rescue Plan.
With many states offering inflation relief checks, the GOP continues to attack Democrats for seeing stimulus checks back in 2021. Many argue that the reason for continued inflationary pressures in the market can be traced back to the sending of these checks.
However, many economists disagree and see supply-side disruptions as a much larger problem. Read our full coverage for more details.
The US Social Security Adminstration announced the largest cost-of-living adjustment in over four decades. Clocking in at 8.7 percent, this historic COLA will shift up the maximum benefit for Social Security by a substantive margin.
The maximum depends on the age at which a person retires.
Disabled veterans and military retirees will see their monthly checks get a boost in 2023. The Social Security Administration announced the biggest cost-of-living adjustment since 1981 after the September 2022 inflation report was released.
Military pensions and disability payments, like most other similar government payments, are required by law to use SSA calculation to keep benefits in line with rising prices. Starting in January 2023, an 8.7 percent increase will be applied to monthly payments surpassing last year’s 5.9 percent bump.
Downward trend in California gasoline price continues
The price of gasoline in California has been dropping for the past 11 days, a trend drivers in the state will surely want to continue. Even so, the average price in the state is over $2 dollars a gallon than the national average.
The Golden State has the highest gas tax in the US and some of the strictest environmental regulations making it the state with generally the highest gasoline prices in the nation. But these account for only around 85 cents a gallon forcing many to ask, "why are gas prices so high in California?"
Gas prices in the US have decreased, but in California, they remain stubbornly high. What is the reason for the difference in price?
Last spring as gas prices spiked a handful of states imposed gas tax holidays,some have since extended them.
Here’s a look at where they are in effect.
California has sent its first batch of payments for the Middle-Class Tax Refund. How does filing status impact eligibility?
Hello, and welcome to AS USA
Hello, and welcome to AS USA's blog on inflation relief payments. We’ll keep you up to date on measures that have been approved in states around the US and nationally to help residents cope with the high price of food, gas, utilities and more.
The Social Security Administration announced a historic cost-of-living adjustment increase for 2023 of 8.7%. The automatic annual boost based on inflation figures will give beneficiaries around the nation a much needed boost to monthly payments. The 2023 COLA will affect pensions for other government workers and VA disability benefits too.
While there is no nationwide direct payment nor tax rebate to help Americans cope with inflation, some state initiatives have already been sent out and others are just making their way to residents.
The Biden administration hasn't been idle either announcing the launch of a Beta version of the Student Loan Forgiveness application. As well the measures to reduce healthcare costs for millions of Americans are going into effect.