By Aman Jain. Originally published at ValueWalk.
A fourth stimulus check is nowhere to be seen, but some families in Connecticut could soon get some extra money from the state government. This Connecticut coronavirus stimulus check is not exactly a direct payment, rather it is part of the state’s earned income tax credit program. Eligible recipients will get this payment in the form of an extra tax refund.
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Connecticut Coronavirus Stimulus Check: Who Will Get It?
Gov. Ned Lamont recently announced that he had asked the appropriate state agency to retroactively enhance the state’s 2020 earned income tax credit. The earned income tax credit will increase from 23% of the federal credit to 41.5%.
Eligible families could get an earned income tax credit of up to $1,000, depending on their income. The amount of enhanced credit that a family gets depends on the size of their federal credit. The IRS uses the taxpayers’ income, number of qualifying children, and marital status to calculate the federal credit.
“For example, a single parent of two at the federal poverty level who received a $1,246 state credit in the spring will now receive an additional $1,002 for a total state credit of $2,248,” Lamont’s office said.
This Connecticut coronavirus stimulus check would benefit about 200,000 low-to-moderate income families who earned up to $56,844 (couples with three or more qualifying children) in 2020. Married couples with no kids and earning up to $27,380 per year and couples with two kids earning up to $53,865, will also qualify for the payment.
A point to note is that families who would get this extra tax refund will be those who filed for the 2020 earned income tax credit.
Varying Rates Of Earned Income Tax Credit
It is estimated that the cost of giving an extra tax refund would amount to $75 million, and it would be covered from the federal COVID-19 relief funds that the state got under the CARES Act.
“Enhancing the 2020 Connecticut Earned Income Tax Credit provides direct relief to workers doing their best to provide for their families while confronting pandemic-related costs from masks and tests to childcare and internet access,” Governor Lamont said in a press release.
Connecticut introduced the earned income tax credit in 2011, and its rates have varied over the last decade. The rate was 30% in 2011 and 2012, 25% in 2013, but was increased to 27.5% from 2014 to 2016. From 2017 to 2020, the rate was 23%, but was recently increased to 30.5% under the fiscal year 2022-2023 biennial state budget, which was signed into law in June.
The Connecticut Department of Revenue Services is expected to start sending the Connecticut coronavirus stimulus checks to eligible households before the end of February.
“The Department of Revenue Services is proud to administer Connecticut’s Earned Income Tax Credit, which puts money back in the pockets of hard-working families,” Connecticut Department of Revenue Services said.
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