The federal US government had stopped providing additional stimulus checks to eligible citizens. On the other hand, Americans have been struggling to cope with the worsening inflation that is leading to sky-rocketing prices of basic products like medicines, gas, and food. In this situation, many states all over the United States of America stepped up and offered further stimulus checks in the form of tax refunds. However, it seems that these stimulus checks might not be as helpful for the citizens as they seemed to be at first.
Rising Inflation, Decreasing Stimulus Check
This inflation is one of the worst ever to have hit the US in almost 40 years. It has made a huge impact on grocery shopping as well as debts and credit cards. In addition, the amount of tax refund is also heavily affected by this inflation. Americans are bearing the worst brunt of this rising inflation owing to the reason that the amount of tax refund might get reduced this year.
Several citizens of the US depend on tax refunds to pay their due and debts but this year they might not be able to do that.
Inflation Eats Into Tax Refund
It has been known that tax refund amounts going to be smaller after eligible citizens had received bigger tax credits and relief payments throughout the COVID-19 pandemic.
People must also note that although the amount might be reduced, the tax refund will feel lesser because the prices have increased by almost 10% in the last 2 years. On average, each American will receive a $2,815 tax refund in 2023 whereas they actually need $3,021. Economic volatility and inflation along with surging interest rates indicate less value of tax refunds this year.