Stimulus checks have been on the minds of several Americans for the past couple of years. First, they helped thousands of households stay afloat during the worst of the pandemic. This year, the extra money from the government helped to fan the flames of the American economy. With those checks, people had more money to get the things they needed and wanted. Additionally, parents across the nation have been receiving monthly advance payments on their child tax credit for the past six months.
Many states, though are still giving back to residents through stimulus checks and tax refunds. For instance, Indiana residents will get an extra $125 when they file their taxes next year, according to Indy Star. This money comes courtesy of state law that limits how much taxpayer money Indiana’s government can keep in its coffers.
Under state law, Indiana’s reserves cannot reach more than 12.5% of its general fund appropriation. This excludes reserves for K-12 education. If they do go over that amount in reserves, the state government must return some of the money to residents. So, this is less of a stimulus check and more of an additional tax refund.
Indiana closed out its 2021 fiscal year back in July. At that time they hey had nearly $4 billion in reserves. That was 23% of its expenditures. According to Indy Star, the state used some of that money to pay down a debt connected to a teacher pension fund. $545 million will find its way back into the hands of Indiana residents by way of the stimulus check/tax refund when they file state income taxes next year.
Indiana Governor on Reserves that Funded the ‘Stimulus Check’
Indiana Governor Eric Holcomb released a statement about the extra money that will come with tax returns. “Despite a pandemic, Indiana exceeded all expectations and closed the state fiscal year with an unprecedented amount in reserves,” he said. Gov. Holcomb went on to say, “We have an obligation to put this money back in the hands of taxpayers instead of leaving it in the hands of government.”
The state also plans to work on a way to get the money to taxpayers who don’t make enough money to warrant filing a tax return. For those, this extra $125 will feel more like a stimulus check than a tax refund. House Speaker Todd Huston said that state legislative leaders will work to pass legislation that will make the additional 910,000 taxpayers eligible for the refund. They hope to get that done early next year. After that legislation passes, those taxpayers will get their money in the form of a check or direct deposit from the state government.