California Middle Class Tax Refund Explainer - Los Angeles Bankruptcy Attorney - Southern California Bankruptcy Attorney | B & C LAW

California Middle Class Tax Refund Explainer

Table of Contents
  1. About California MCTR

California’s Middle Class Tax Refund (MCTR) payments started hitting bank accounts in Los Angeles and throughout the state on October 7, so you may already have received your refund. If you’re still waiting for your refund and want to know what to expect, or don’t understand the amount of your refund, here’s what you need to know.

California Middle Class Tax Refund Explainer

About California MCTR

What is the Middle Class Tax Refund Program? 

The MCTR is a one-time payment designed to provide relief to middle-income and lower-income residents of California. The program builds on last year’s Golden State Stimulus program, which distributed $9 billion to help Californians who were struggling during the pandemic.

$9.5 billion in refunds are slated to be delivered to California residents between early October and January, with most payments likely to be distributed by the end of the year. California Governor Gavin Newsom said, “We know it’s expensive right now, and California is putting money back into your pockets to help. We’re sending out refunds worth over a thousand dollars to help families pay for everything from groceries to gas.” 

Who is Eligible for the California Middle Class Tax Refund? 

Qualifying for the refund depends on a variety of factors, including income, tax filing status, and residency. The basic qualifications include: 

  • The recipient must reside in California at the time the payment will be made
  • With very limited exceptions, the recipient must have filed their 2020 tax return by October 15, 2021
  • The recipient must have been a California resident for at least six months in 2020
  • The recipient was not eligible to be claimed as a dependent on someone else’s taxes for the 2020 tax year
  • The recipient must meet income requirements based on their tax filing status

For those filing as single or married filing separately, the income cut-off is $250,000. Those filing jointly with a spouse or registered domestic partner (RDP) or as head of household or qualifying widow(er) may have adjusted gross income of up to $500,000. However, the amount of the refund will vary based on income and filing status. 

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How Much Will My MCTR Be? 

The maximum MCTR refund is $1,050. Those who meet the requirements listed above, file jointly with a spouse or domestic partner, reported income of $150,000 or less, and have at least one dependent will receive the maximum refund. 

Those filing as single or married/RDP filing jointly with incomes of $75,000 or less will receive $700 with a dependent and $350 with no dependents. 

All others with incomes of $150,000 or less will receive varied amounts depending on their filing status and whether they have dependents, as follows: 

  • $700 if: 
    • They filed married/RDP filing jointly without a dependent
    • They filed as head of household or qualifying widow(er) and had at least one dependent
  • $500 if: 
    • They filed single or married/RDP filing jointly, had a dependent, and reported earnings of between $75,001 and $125,000
  • $400 if: 
    • They filed as single or married/RDP filing separately, had at least one dependent, and reported earnings of more than $125,000 
  • $350 if: 
    • They filed as head of household or qualifying widow(er) and had no dependents
  • $250 if: 
    • They filed as single or married/RDP filing separately, had no dependents, and reported income between $75,001 and $125,000
  • $200 if: 
    • They filed as single or married/RDP filing separately, had no dependents, and reported earnings of more than $125,000 

Those reporting incomes between $150,001 and $250,000 will receive: 

  • $750 if:
    • They filed married/RDP filing jointly and had at least one dependent
  • $500 if: 
    • They filed married/RDP filing jointly and had no dependents
    • They filed as head of household or qualifying widow(er) and had at least one dependent
  • $400 if: 
    • They filed as single or married/RDP filing separately, reported income of more than $125,000, and had a dependent
  • $250 if: 
    • They filed as head of household or qualifying widow(er) and had no dependents
  • $200 if: 
    • They filed as single or married/RDP filing separately, reported income of more than $125,000, and had no dependents

Those with incomes of $250,001 to $500,000 will receive: 

  • $600 if: 
    • They filed married/RDP filing jointly and had at least one dependent
  • $400 if: 
    • They filed married/RDP filing jointly and had no dependents
    • They filed as head of household or qualifying widow(er) and had a dependent
  • $200 if: 
    • They filed as head of household or qualifying widow(er) and had not dependents

Those who filed as single or married/RDP filing jointly who reported incomes of more than $250,000 are not eligible for a refund

How Do I Get My Refund? 

If you filed your 2020 tax return by October 15, 2021 and are eligible for the MCTR, you will receive your refund automatically. 

If you e-filed your 2020 California tax return and received your tax refund by direct deposit, you can generally expect to receive your refund by direct deposit. However, you can expect to receive your refund in the form of a debit card mailed to you if: 

  • You filed a paper return for 2020 or e-filed but received your refund by check
  • You owed state taxes for 2020
  • You received your Golden State Stimulus payment by check
  • Received your 2020 refund by direct deposit, but have since changed banks or account numbers
  • Received an advance payment from your tax preparer or paid your tax preparer with your tax refund

When Will I Get My MCTR?

If you haven’t already received your refund, here’s what you can expect: 

  • If you’re receiving your refund by direct deposit and you received a Golden State Stimulus (I or II) payment through direct deposit, your refund should be deposited by October 25
  • If you’re receiving your refund by direct deposit but did not receive a Golden Gate Stimulus payment, your refund should be processed by November 14
  • If you are receiving your payment via a debit card mailed to you, the shipping dates are not yet available. However, the goal is to have most payments made by the end of 2022, with the remainder by mid-January of 2023. 

If you’re expecting a refund and haven’t received it by January 15, 2023, you can find more information about what to do next here.

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