Pixabay|While federal stimulus checks ended several years ago, some states have continued to provide assistance to residents in the form of tax rebates or so-called “inflation relief” payments.
In context of such payments, the Internal Revenue Service (IRS) issued clarification earlier this year that most relief checks issued by states last year aren’t subject to federal taxes and so for the most part don’t need to be reported on 2022 tax returns.
Here’s a look at what states are offering in terms of such payments in 2023, including eligibility criteria, delivery timelines, and amounts of money either already paid out—or still coming.
Alabama
Starting in the fall of 2023, Alabama residents will begin receiving one-time tax rebate checks. The payment amounts will be determined by the filing status reported on 2021 tax year returns.
If individuals filed as single, head of family, or married filing separately, they will receive a $150 tax rebate payment. For those who filed as married filing jointly, a $300 tax rebate payment will be issued.
Not all individuals, however, are eligible for the Alabama tax rebate. If you did not file a personal Alabama income tax return for the 2021 tax year, you will not qualify for the 2023 Alabama tax rebate check.
Furthermore, estates and trusts are ineligible to receive these payments. In addition, individuals who were claimed as dependents on a 2021 federal or Alabama state income tax return will not receive a rebate payment.
California
California’s middle-class tax refunds (MCTRs) were available to California residents who filed a 2020 tax return by Oct. 15, 2021, and met specific criteria.
These criteria included not exceeding income limits, not being claimed as a dependent on another person’s 2020 tax return, and being a California resident for at least six months in 2020.
The MCTR amount ranged from $200 to $1,050, depending on factors such as income, filing status, and dependents.
Payments were generally sent out between October 2022 and mid-January 2023, with most eligible Californians set to have received them by mid-February at the latest.
The California FTB reported that nearly 32,000,000 taxpayers and their dependents benefited from the tax refund.
Colorado
Coloradans were poised to receive “cash back” payments if they met the eligibility criteria.
In order to qualify, they must have been aged 18 or older as of Dec. 31, 2021, and they must have been residents of the state for the entirety of 2021 and filed a 2021 Colorado income tax return or applied for a Colorado property tax/rent/heat credit (PTC) rebate.
The payment amount varied based on the filing status indicated on the 2021 Colorado state tax return, with eligible single filers generally receiving $750 and eligible joint filers receiving $1,500.
The majority of Colorado cash-back payments were issued by the end of September 2022, with most payments distributed by January 31, 2023.
Georgia
Qualifying Georgia residents were eligible to receive tax rebates of up to $500.
The relief payments have been set up as a one-time tax credit, also known as a surplus tax refund, for individual taxpayers who filed state income tax returns for the tax years 2021 and 2022.
To qualify for the refund, Georgia residents needed to file their tax return by the April 18, 2023, deadline. However, if they received an IRS tax deadline extension, they have until Oct. 16, 2023, to file.
Another condition of receiving a tax rebate is that the individual must have had a tax liability for the 2021 tax year. Both Georgia residents, including part-year residents, and nonresidents of Georgia are potentially eligible to receive the refund.
The specific amount of the Georgia surplus tax refund for 2023 is determined by a person’s tax liability from the 2021 tax year.
Maine
Maine residents who met certain criteria had the opportunity to receive winter energy relief payments.
These payments were designed to assist individuals and couples with their energy costs during the winter season.
Eligibility requirements included filing a 2021 Maine personal income tax return as a full-time resident by Oct. 31, 2022, and not being claimed as a dependent on another person’s tax return.
Income limits were also considered, and payment amounts varied based on filing status.
The state began distributing payments in mid-January, and residents who did not receive a payment have been given the opportunity to contact the state tax assessor by June 30, 2023, to provide necessary documentation to prove their eligibility.
The state tax assessor has until Sept. 30, 2023, to issue relief payments to eligible individuals who contacted them before the deadline.
Montana
Montana residents can expect to receive one-time income tax rebate checks in 2023.
While the specific rebate amount is determined based on the information provided in each individual’s 2021 tax return, the potential maximum amount is $2,500.
To be eligible for a payment, only Montana taxpayers who filed a 2021 Montana full-year resident tax return will be considered.
In addition, Montana residents must have filed either a part-year or full-year 2020 state tax return. The tax rebate bill sets forth several qualifying criteria, which include the following:
Filing 2020 and 2021 Montana tax returns by the 2021 tax year deadline, unless an extension was granted.
Individuals claimed as dependents on a 2021 Montana or federal income tax return are ineligible for the payment.
To receive an income tax rebate payment, Line 20 of the Montana Form 2 must indicate an amount greater than zero.
In addition, eligible residents will also receive a property tax rebate from Montana. This rebate applies to the years 2022 and 2023, with a maximum amount of $675.
In order to qualify for the property tax rebate, individuals must have owned and utilized the property as their primary residence for at least seven months in each of those years.
Furthermore, they must have made property tax payments for both 2022 and 2023.
New Mexico
Eligible residents of New Mexico can expect to receive rebate checks of up to $1,000.
In the coming weeks, New Mexico will begin the distribution of one-time rebate checks for 2023 to eligible residents, who can anticipate receiving the rebates as early as mid-June.
The payment amount will be determined based on the filing status reported on 2021 tax returns.
No application is required for the rebates, which will be sent out automatically.
Eligible individuals have until May 31, 2024, to file their 2021 tax returns and qualify for the rebate.
If the filing status for the 2021 tax year was head of household, married filing jointly, or qualifying widow(er), a payment of $1,000 can be expected.
Single filers or those who filed as married filing separately will receive a payment of $500.
For those who filed as married filing jointly, the rebate payment will be sent to the primary taxpayer listed on the 2021 New Mexico state tax return.
Pennsylvania
Pennsylvania’s Property Tax/Rent Rebate program provides payments to eligible individuals who meet certain criteria.
They must be at least 65 years old, a widow(er) at least 50 years old, or a person with disabilities who is at least 18 years old.
In addition, there is an annual income limit, with homeowners capped at $35,000 and renters at $15,000 (with 50 percent of Social Security benefits excluded).
The specific rebate amount is determined based on income and whether the individual owns or rents their home. Eligible homeowners, including some exceptions for older adults above the age of 65 who may receive a higher amount, can generally expect rebates of up to $650.
Rebate checks were initiated in August 2022, and eligible residents had until the end of 2022 to apply for a rebate. Consequently, payments will continue into 2023.
South Carolina
To qualify for a tax rebate in South Carolina, residents must have filed a 2021 South Carolina state income tax return by Feb. 15, 2023, and have a state tax liability for the 2021 tax year.
The rebate amount can reach up to $800 and will be determined based on an eligible individual’s 2021 South Carolina income tax liability after subtracting any applicable credits.
For tax liabilities below $800, the rebate amount will match the individual filer’s tax liability. However, if the tax liability exceeds the $800 cap, the filer will receive a rebate of $800.
Eligible filers should have received a rebate check by March 31, 2023.
Virginia
To be eligible for Virginia’s one-time stimulus tax rebate, taxpayers needed to file a 2021 Virginia income tax return by Nov. 1, 2022, and have a 2021 Virginia net tax liability.
It’s worth noting that even if a taxpayer received a refund after filing their 2021 state return, they could still qualify for a rebate. The rebate amount, with a maximum of $500, was based on a filer’s 2021 Virginia tax liability.
Those who filed their state tax return by Sept. 5, 2022, and met the eligibility requirements, should have received their payment by October 31 of 2022.
However, if taxpayers filed their return between Sept. 6 and Nov. 1, 2022, their payment would arrive within four months from the date they filed, which could have been as late as February 2023.
Edited by: TJVNews.com
U.S. prosecutors are intensifying efforts to tackle commercial mortgage fraud, a crackdown that is unsettling the $4.7 trillion industry by scrutinizing the financials underpinning major property loans. According to the information provided in a recently published report in The Wall Street Journal, the move comes as regulators and federal prosecutors identify a rise in property loans based on manipulated financials and valuations, a trend that gained momentum from the mid-2010s through 2021. This period saw a significant surge in commercial property prices, creating fertile ground for fraudulent activities as landlords sought to capitalize on inflated valuations.
The current economic landscape, characterized by declining property values due to higher interest rates and an increase in defaults, is exposing numerous fraudulent schemes that went undetected during the market boom, as was reported by The WSJ. This revelation adds to the woes of a commercial real estate market already reeling from its most challenging period since the 2008-09 financial crisis.
Speaking to The WSJ, John Griffin, a finance professor at the University of Texas’ McCombs School of Business, succinctly captured the cyclical nature of fraud: “It’s a general trend throughout history that fraud occurs during boom times and is revealed during bust times.” This pattern is now playing out in the commercial real estate sector, where the previous period of rapid price escalation is giving way to a harsher economic reality.
A key factor enabling real estate fraud is the typically hands-off approach lenders take when assessing a building’s value. As long as financial figures appear consistent with those of comparable properties, lenders tend to accept them at face value. The WSJ report indicated that this trust-based system, however, leaves room for manipulation. Conducting thorough audits is both costly and time-consuming, and lenders, eager to secure deals, often avoid imposing rigorous due diligence that could alienate potential clients.
The recent shift in market conditions has prompted federal prosecutors to ramp up their efforts to uncover and address fraud. As per The WSJ report, they are increasingly collaborating with investigators from the Federal Housing Finance Agency’s Office of Inspector General. This joint effort calls attention to the seriousness with which authorities are approaching the issue.
One high-profile case illustrating the crackdown involves a major commercial property developer accused of inflating the value of several properties to secure larger loans. Prosecutors allege that the developer provided falsified rent rolls and overstated occupancy rates, thereby inflating property valuations, The WSJ report noted. Such fraudulent activities not only jeopardize the integrity of financial markets but also have far-reaching implications for investors and the broader economy.
The fallout from these fraudulent schemes is considerable. As property values drop and defaults rise, the risk of significant financial losses looms large for lenders and investors alike. The discovery of inflated valuations and doctored financials further erodes confidence in the market, potentially leading to tighter credit conditions and higher borrowing costs for legitimate property owners.
While the exact number of ongoing investigations remains undisclosed, a series of plea deals reached since last fall highlights the scale of the problem. At least five landlords, primarily of apartment buildings in cities such as Cincinnati, Hartford, Conn., and Little Rock, Ark., have admitted to federal fraud charges, according to The WSJ report. These cases involve various fraudulent activities, including falsifying building income statements and faking property sales at inflated prices, all aimed at securing larger loans.
Government-backed mortgage enterprises Fannie Mae and Freddie Mac have responded to these revelations by tightening their lending practices and cracking down on suspicious activities within their rental-apartment lending business. The information contained in The WSJ report said that one notable case involves Meridian Capital Group, a mortgage brokerage that has been effectively blacklisted by both Fannie Mae and Freddie Mac after allegations surfaced that one of its brokers doctored financial statements to secure larger loans. This blacklist has since extended to brokers at other firms suspected of similar misconduct.
In a bid to combat fraud, Freddie Mac has overhauled its underwriting policies. The agency now requires borrowers to submit rent receipts and has instructed lenders to conduct more thorough inspections of apartments to verify occupancy, the report in The WSJ said. Fannie Mae, on the other hand, is meticulously reviewing existing loans to identify those based on dubious financial data, according to sources familiar with the matter.
During a May earnings call, Ivan Kaufman, CEO of commercial mortgage lender Arbor Realty Trust, highlighted the impact of fraud on the industry. Speaking to The WSJ, he noted that fraud, particularly within the brokerage sector, has been an unforeseen challenge contributing to the market’s stress. “I think there was a lot of elevated fraud in the industry through the brokerage industry,” Kaufman remarked.
At the core of this issue is the process by which lenders underwrite commercial mortgages. Borrowers typically submit financial statements known as T-12, which detail a building’s income and expenses over the past year. Lenders rely on these documents to assess the building’s value and determine the loan amount. However, the lack of auditing these statements leaves room for manipulation. The WSJ report explained that most lenders do not verify whether the reported sums actually flowed in and out of the landlord’s accounts, making it easier for unscrupulous individuals to present inflated or entirely fictitious financials.
