USA finance and payments news summary | 4 May 2022

TurboTax to refund customers $141 million for "free file" bait and switch

New York Attorney General Letitia James announced on Wednesday that a settlement has been reached with Intuit, the owner of tax filing software TurboTax. In a settlement with all 50 states for allegedly steering about 4.4 million customers away from federally supported free tax-filing services the company has agreed to pay $141 million.

Filers will be mailed a check for around $30 for each tax year 2016 through 2018 that they used TurboTax's Free Edition and were charged when they should have been able to use services at no cost. 

As part of the settlemeent Intuit must also suspend its "free, free, free" ad campaign which falsely lured customers with the promise of free tax preparation services.

Senator Rick Scott released an Ultra-MAGA Agenda. It could raise taxes on 75 million American families. Under this new plan, while big corporations and billionaires would pay nothing more, working-class folks are going to pay a hell of a lot more.

Biden takes to task Senator Rick Scott's midterm agenda

During a speech on the deficit, President Biden took aim at Republican Senatorial Campaign Chair Rick Scott's 'Plan to Rescue America.' Among other things it calls for programs like Social Security and Medicare to sunset after five years, requiring a vote to renew the programs. It would also establish a minimum amount of income tax that all Americans would pay "to have skin in the game."

An analysis of Scott's plan by the Institute on Taxation and Economic Policy found that the brunt of the federal income tax increase would be borne by the poorest two fifths of Americans. The states where more than 40 percent of the residents would see a tax hike were in the south including the senator's home state, Florida.

Haven't filed a 2021 tax return? IRS wants you to get it in ASAP to avoid penalties

The majority of taxpayers managed to file their 2021 tax returns on time, but there were a fair number of filers who still need to turn in their tax declaration. The IRS advises to get your tax filing in as soon as possible, not only to receive your tax refund but to avoid any potential late penalties.

That is especially true for taxpayers that have an outstanding bill with Uncle Sam. Even if you file on time or requested a six-month extension, interest and penalties start to accrue from the tax deadline, which was 18 April in 2022.

Here’s what you need to know…

US trade deficit grows as imports increase more than exports

According to the US Bureau of Economic Analysis and the US Census Bureau, exports of goods and services increasing 5.6 percent, but that was outpaced by a 10.3 percent increase in imports. The resulting US monthly international trade deficit rose to $109.8 billion in March.

The previous month's deficit was revised upward from $89.2 billion to $89.8 billion in February. 

Gas prices upward trend looks set to continue

Gas prices had been moving downward since peaking at around $4.33 per gallon in March, but a little over a week ago reversed direction. In the past week prices have jumped almost ten cents a gallon for regular unleaded to $4.22 on average Wednesday according to AAA. Only 18 states have an average under $4 currently.

What does Fed half point rate hike mean for Americans?

Federal Reserve chair Jerome Powell announced that the US central bank voted to raise its benchmark overnight interest rate by half a percentage point. Powell told the press that policymakers were ready to follow the largest rate hike in 22 years with similiar half point jumps in June and July as they move more agressively to tackle rising prices.

But what will that mean for Americans? PBS's Paul Solman explains.

FINANCIAL SUPPORT PROGRAMS

What other benefits can I get with Social Security disability?

While Social Security benefits are managed at the federal level through the Social Security Administration (SSA), financial support programs for low-income Americans are generally handled at the state or local level. This means that eligibility requirements can vary from state to state.

Those that receive Social Security Disability Insurance (SSDI) may also receive Supplemental Security Income (SSI). This is known as receiving “concurrent benefits” but the qualifications for each are different. Likewise, there is no prohibition from the federal government on receiving other benefits in addition to these SSA programs, but some states may not allow recipients of disability benefits to participate.

Full details

What has the Fed chair said about inflation?

[The inflation] is very unpleasant. If you're a normal economic person, then you probably don't have ... that much extra ... to spend and it's immediately hitting your spending on groceries ... on gasoline on energy and things like that. So we understand the pain involved.

Federal reserve increases interest rates again

The Federal Reserve on Wednesday raised its benchmark overnight interest rate by half a percentage point, the biggest jump in 22 years.

The Fed set its target federal funds rate to a range between 0.75% and 1% in a unanimous decision, with further rises in borrowing costs of perhaps similar magnitude likely to follow.

US NEWS

What is the average monthly Social Security disability benefit?

Just over 12 percent of 70 million beneficiaries of Social Security Administration (SSA) receive payments due to a disability. This equates to over 8 million Americans needing support.

While Supplemental Security Income is set by the federal government with variations at the state level, Social Security disability payments (SSDI) vary for each individual and are calculated in a similar fashion to retirement benefits. 

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Additional Social Security funding is required

The value of Social Security relief programs has rarely been as clearly displayed as it was during the early phase of the pandemic, offering vital financial support to tens of millions of vulnerable Americans. The Social Security Administration (SSA) oversees a variety of programs, targeting retired, disabled and low-income households to ensure that they can afford to cover the cost of essentials. 

However the shifting demographics of the United States means that the average age has risen, increasing the SSA's financial burden. The ensure that the agency is able to satisy its commitments to tens of millions of Americans, lawmakers have proposed significant changes to the funding model that are hoped to secure it for decades to come. 

US NEWS

Are Social Security disability payments for lifetime?

The distribution of Social Security Disability Insurance (SSDI) is based on numerous eligibility requirements, some related to the financial means of the individual and some pertaining to their physical or mental condition. 

Disability benefits will continue as long as your medical condition has not improved and this prevents you from working. Benefits won’t necessarily continue indefinitely, the SSA will review your case periodically to make sure you still have a qualifying disability. If it is determined that you are fit to work then the disability benefits will end and you will be classed as unemployed.

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WELFARE PROGRAMS

What are the main types of financial assistance I can apply for in California?

Most of the financial assistance programs available are state-specific, and there are also a variety of federally-funded programs managed by the state or county governments which operate under California-specific names.

Qualifying Golden State residents can get help through tax benefits to low-income workers and programs which provide money to buy food, pay for housing, get access to medical care. Here's what you need to know about those programs and how to apply...

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Why are gasoline prices so high?

Speaking on CNBC's 'Power Lunch' Francisco Blanch, BofA Global Research head of global commodities and derivatives research, explains why energy prices have been pushed so high in recent months. The ongoing Russian invasion of Ukraine has resulted in major Western powers imposing significant economic sanctions on Moscow. 

Much of the focus of those restrctions has been the Russian fuel industry, a key component of the Kremlin's income stream and the best way to exert pressure on President Putin. Unfortunately a side effect of this measure is that gasoline prices have soared in the United State. 

Sharp increase to gas prices in some states

AAA has been tracking the average prices of gasoline across the country and also maintains figures relating to individual states. It is no secret that the price of gas can vary greatly across the United States but the scale of the difference is still shocking. In the last week there have been major increases in a number of states: Delaware (+22 cents), Maryland (+21 cents), Ohio (+19 cents)

“As long as the supply remains tight, it will be hard for crude oil prices to fall and consumers will face higher prices at the pump,” said AAA spokesperson Andrew Gross. “It now costs drivers in the U.S. about $23 more to fill up than a year ago.”

How can I book a Social Security Income (SSI) appointment?

The Social Security Income program provides financial support for adults and children with low income and resources, and who are blind or disabled. It acts as vital form of federal relief for individuals who may struggle to cover the cost of essentials and can be a main source of income for many recipients. 

The Social Security Administration recently launched a new online option to request an appointment to file for SSI, making the prcess easy and straight forward. HEre's everything you need to know...

US NEWS

Can I collect Social Security and disability at the same time?

Around 17 million Americans were receiving payments from either Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) by the end of 2021.

Eligibility requirements for SSI benefits are fairly strict as the programme is designed to support specific groups of low-income Americans. Recipients of SSI payments must be aged 65 or older, blind or disabled. The eligibility for SSDI payments are more difficult as claimants must have a disability that specifically prevents them from working.

But can you receive both forms of federal support at the same time? We take a look...

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Can Social Security recipients enroll in Medicare?

Medicare provides vital healthcare provision for elderly and disabled Americans at a reduced, or free, cost. The federal program had more than 36 million people covered as of October 2021, and there are millions more eligible Americans who have not yet signed up to receive the health insurance. 

Here's how you can check you eligibility for Medicare and apply to receive support from the program...

White House considers the prospect of student loan forgiveness

Talk of student loan forgiveness has been mooted again in recent weeks and President Biden is expected to submit a proposal to ease the financial burden on borrowers. For now, Biden has refused to give full details on the new measures but White House press secretary Jen Psaki has confirmed that the President is considering a number of different options. 

Biden the butt of the joke at White House Correspondents' Dinner

 “I think ever since you came into office, things are really looking up, you know. Gas is up, rent is up, food is up, everything."

Gas prices and electricity bills combine to hit consumers

The rapidly rising cost of electricity in the United States is expected to cause more headaches for consumers, compounding the financial impact of soaring gas prices. The average price of a gallon of gasoline across the US has broken historic records in recent weeks and there appears little chance of respite for consumers in the near future. 

“This is an affordability emergency,” The Utility Reform Network executive director Mark Toney told The New York Times. “If you want to control inflation, one of the things you have to control is energy costs.”

Housing market pressures exacerbated by high inflation

It is no secret that the rate of inflation has soared over the past year as the American economy powers up again after the pandemic restrictions have been removed. It is an important step in getting back to normal but the rapid expansion of the economy is having major drawbacks for many Americans, particularly those hoping to buy a house. 

As is explained here inflationary pressures are pushing up the prices of everything in the United States, and it's hitting prospective homebuyers hard. 

US NEWS

What conditions are considered a disability for Social Security?

Social Security payments do not just provide financial support for senior citizens, disabled Americans can benefit from the support programs too. Both the Supplementary Security Income (SSI) and the Social Security Disability Insurance (SSDI) payments can be attained by having a disability, but both have different requirements.

Here's everything you need to know about the eligibility requirements for both programs, and how to apply...

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Georgia celebrates positive unemployment figures

"We are setting records in total workforce, total employment, the fewest unemployed since the early 2000s and we are a much bigger state. This is not a problem anybody has ever seen at this scale ... You can throw out the book. People are not saying this is a great problem to have. It is the flip side of a bad economy. You have a situation where orders are skyrocketing and you cannot get personnel."

New study shows the benefits of the boosted Child Tax Credit

After previous surveys to determine where the Child Tax Credit has been sent, the Tax Policy Center has released new findings for a follow up survey conducted at the end of the expanded payments in December. Most families used the CTC to cover routine expenses without reducing their employment. Families were able to plan their funds better, as well as prepare their chidlren for schol and university.

This was especially trure for Black, Hispanic, and other minority families. The group found that the expanded Child Tax Credit was important tool for addressing both racial financial inequality in the United States.

Post-pandemic economy leaves countless unfilled jobs

Last October the state of Georgia reached its record low unemployment rate of 3.4%, a key step along the road to marking the end of the covid-19 pandemic's economic impact. As the rate fell steadily and hit 3.1% in March 2022, it became clear that there was another major issue as businesses struggled to fill vacancies.

Indeed, the imbalance between labor supply and demand in Georgia is among the most acute in the country, according to federal data pointing to a difficult adjustment ahead as jobs and workers reshuffle for the post-pandemic world.

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