2023 Tax Rebate Eases The Stress of Holiday Debt:
A recent survey by WalletHub indicated that nearly 25% of Americans still have holiday debt from last year. Additionally, almost half of them say they won’t pay off their purchases for this year by the bill due date. With inflation taking a bigger bite out of everyone’s paycheck, a financial crisis seems to be on the horizon. Fortunately, some welcome help is on the way from our state legislators. The State of Alabama, through our state legislators, has passed legislation that provides a one-time tax rebate of $150. Joint filers will receive $300.
What are the eligibility criteria for Alabama tax rebate?
The eligibility criteria for the 2023 tax rebate are relatively straightforward.
Who is eligible?
You are eligible if you filed your 2021 state income tax return by October 17, 2022. There are no income limitations.
Who is not eligible?
- Dependents (in 2021)
- You are not eligible if you didn’t file your 2021 state income tax return by October 17, 2022.
What are the rebate distribution methods?
If you were set up for direct deposits of tax refunds in 2021, that’s how you will receive your rebate. Otherwise, you will receive it by mail.
CAUTION: With increased mailbox theft, check your mailbox daily for rebate check.
When are checks going out?
The checks began going out on December 1st. If you are eligible and you haven’t received yours yet, then you should be on the lookout for it to come soon.
What are some beneficial ways to utilize your tax rebate?
You may want to consider using this unexpected or extra money you receive to pay off your credit card debt. This is because credit card debt typically has high interest rates of around 18% or more, potentially making it the most expensive type of debt you have. Paying off your credit card debt can help save yourself a considerable amount of money in the long run.
There are several other ways to use the ‘found’ money, such as investing or donating it. By investing the money, it will grow in value over time. For instance, if you invest $300 today, it could potentially become $3,000 in 30 years. Additionally, giving the money to charity not only benefits the community but could also result in a tax refund, which could save you money as well.
For more financial information or guidance, don’t hesitate to get in touch with us!
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Stewart H. Welch, III, CFP®, AEP, is the founder of THE WELCH GROUP, LLC, which specializes in providing fee-only investment management and financial advice to families throughout the United States. He is the author or co-author of six books, including 50 Rules of Success; J.K. Lasser’s New Rules for Estate, Retirement and Tax Planning- 6th Edition (John Wiley & Sons, Inc.); THINK Like a Self-Made Millionaire; and 100 Tips for Creating a Champagne Retirement on a Shoestring Budget. For more information, visit The Welch Group. Consult your financial advisor before acting on comments in this article.
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