Economy

Yes, Tax Rebate Checks from Alabama Very Possible Now

If you live in Alabama, some money could soon be coming your way, thanks to the state’s historic revenue surplus. Over the past few months, lawmakers have been discussing how to use the $2 billion revenue surplus. Though nothing has been finalized as of yet, many seem to favor sending one-time tax rebate checks from Alabama.

Are One-Time Tax Rebate Checks From Alabama Possible?

Alabama ended the fiscal year 2022 on a strong note, with a budget surplus of almost $2 billion. For the fiscal year ending September 30, both the General Fund and Education Trust Fund budgets reported record revenue.

According to the Alabama Policy Institute (API), the state government collected over $13 billion in the fiscal year 2022, giving the state a surplus of almost $2 billion. Alabama lawmakers, over the past couple of months, have discussed many proposals on how to use this revenue surplus, including sending one-time tax rebate checks from Alabama.

Senator Arthur Orr, who backs the idea of sending rebate payments, says the state could use the surplus to send a one-time rebate of up to $200 to each individual taxpayer. So, those filing jointly could get up to $400 in a rebate payment.

“As the budget chair, it’d be my recommendation that we spend a goodly portion rebating the money or sending the money back to Alabama taxpayers because they’re the ones that gave it to us in the first place,” said Senator Orr.

Some lawmakers want the state to go for tax cuts along with sending one-time rebate checks.

Other Possible Uses Of The Surplus Money

Not all, however, believe that sending the one-time tax rebate checks could be the best use of the surplus money. Many lawmakers prefer long-term investments over sending one-time payments.

House Minority Leader Anthony Daniels (D-Huntsville), for instance, believes that sending a one-time rebate may sound good, but it doesn’t solve the long-term problem. Thus, Daniels wants lawmakers to use the surplus money on grocery tax holidays, universal Pre-K investments, or even saving it for unfavorable times.

State Sen. Garlan Gudger (R-Cullman) floated another idea recently on how the surplus money could be used. Gudger said that some portion of the surplus money could be used to pay the state’s existing debt and the remainder to form a savings account.

Using the surplus money to pay off existing state debt could eventually save taxpayers money in the long run. Gudger’s other suggestion of creating a “rainy day” fund, however, makes little sense as the state already has many rainy-day accounts that haven’t been used since 2012.

All of these proposals regarding the use of surplus money will be up for discussion and debate during the 2023 legislative session, which starts in March of 2023. So, taxpayers could receive a one-time rebate check in the mail sometime next year.

This article originally appeared on ValueWalk

Sponsored: Find a Qualified Financial Advisor

Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.