Middle Class Tax Refund: Due to the economic difficulties caused by COVID-19, the federal government issued multiple rounds of stimulus checks to support Americans. Although there won’t be a fourth federal stimulus check, California is offering its own relief. Residents can now receive a $1,200 payment called the Middle Class Tax Refund (MCTR).
This article will break down what the MCTR is, how it’s figured out, and how Californians who qualify can get their payments.
The Middle Class Tax Refund (MCTR)
What is the MCTR?
The Middle Class Tax Refund (MCTR) is a one-time payment meant to help Californians who are feeling the pinch from inflation and rising living expenses. This program is here to offer a bit of financial relief to middle and lower-income families who are finding it tough to keep up with the high cost of living in the state.
Why Was the MCTR Introduced?
In 2022, inflation in the U.S., especially in California, hit its highest level in 40 years. Prices for essentials like food, housing, healthcare, and gas went through the roof, causing a lot of financial stress for people. To help out, the California Legislature and Governor put together the Better for Families Act, which brought about the MCTR.
Calculating the MCTR Payment
How is the MCTR Payment Calculated?
To figure out how much you get for the MCTR payment, the Franchise Tax Board (FTB) looked at data from 2020 individual income tax returns. They used your adjusted gross income (AGI) and your filing status to determine your payment amount.
MCTR Payment Amounts by Filing Status
| Status | AGI Range | Without Dependents | With Dependents |
|---|---|---|---|
| Individual | |||
| Up to $75,000 | $350 | $700 | |
| Up to $125,000 | $250 | $500 | |
| Up to $250,000 | $200 | $400 | |
| Joint | |||
| Up to $150,000 | $700 | $1,050 | |
| Up to $250,000 | $500 | $750 | |
| Up to $500,000 | $400 | $600 | |
| Surviving Spouse or Head of Household | |||
| Up to $150,000 | $350 | $700 | |
| Up to $250,000 | $250 | $500 | |
| Up to $500,000 | $200 | $400 |
This table simplifies the information, making it easier to compare the different amounts based on AGI range, status, and whether dependents are involved.
Receiving the MCTR Payment
How Will Eligible Candidates Get Their Payments?
In January 2024, the California Department of Finance discovered that more than one million MCTR debit cards, totaling $611 million, hadn’t been activated. These cards were intended for middle- and lower-income families to help with inflation-related expenses.
Activation Reminder
If you got an MCTR debit card but haven’t activated it yet, don’t worry! You’ll receive a reminder letter soon with easy steps on how to activate it. If you think you should have received a debit card but haven’t, check that your address is up to date with the FTB.
How to Activate Your MCTR Debit Card
To activate your MCTR debit card, just call 1-800-240-0223. You’ll set up your 4-digit PIN and check your card balance. Make sure to review the cardholder agreement, fee schedule, and transaction limits.
Don’t forget to sign the back of your MCTR debit card once it’s activated.
The Middle Class Tax Refund (MCTR) is here to help Californians with the increasing cost of living due to inflation. Since there might not be another federal stimulus check, this state initiative is a great way to get some extra support. If you’re eligible, make sure to activate your debit card and keep your details updated with the Franchise Tax Board to get your payments.
FAQs
What is the Middle-Class Tax Refund (MCTR)?
The MCTR is a one-time payment designed to help California residents who are struggling with the impact of inflation.
How is the MCTR payment calculated?
The payment amount depends on your adjusted gross income (AGI) and filing status from your 2020 tax return.