California’s economic stimulus check program has recently returned to the spotlight. The prevailing concern for the State’s Fiscal Board is the significant $600 million set aside for economic relief that remains unclaimed to this day. In its endeavors to provide financial relief during the escalating inflation that began in 2022, the California Franchise Tax Board has successfully allocated $9.2 billion.
While a majority of those who qualify have already benefited from their entitled California stimulus payment, a staggering $600 million continues to lie dormant. The unclaimed sum is attributed to its unique distribution method. Instead of traditional checks or direct deposits, the relief funds were loaded onto credit cards which were then dispatched to the rightful taxpayers. However, a notable portion of recipients hasn’t activated these cards, leaving the funds inaccessible.
Unclaimed California Stimulus check Distribution Challenges and Taxpayer Hesitation
A closer look reveals that only 87% of these distributed debit cards, equivalent to about $4.6 billion, have been put into use. This indicates that cards worth an accumulated $600 million are yet to be activated. While the cards have been disseminated, the onus is now on the taxpayers to activate and access their funds. The hesitance of some could be rooted in suspicions of potential scams.
A report unveiled by the California Franchise Tax Board provides further insight, stating that almost half — precisely 45% — of the activated cards maintain a zero balance. So far, these cards account for an expenditure of $2.1 billion.
Highlighting the gravity of the situation, data from June 2022 showed an alarming 9.1% inflation rate year-over-year. This was the most drastic surge the consumer price index has recorded in four decades. The criteria for availing of this stimulus include:
- Residency in California for a minimum of six months in the 2020 fiscal year.
- Adherence to the specified adjusted gross income limits.
- Completion of tax filing by October 15, 2021.
- No claims as dependents on the 2020 tax filing.
Introduced as the “Tax Refund for the Working Class,” this California stimulus initiative was green-lighted in July 2022. The program sanctioned varying single payments, with some reaching as high as $1,050. This was a strategic move to support Californians grappling with the burdens of inflation and escalating fuel prices. For eligibility based on income, married couples filing together are capped at $500,000, while individual taxpayers have a limit of $250,000.