California gas rebates coming this month. How much will you get?

Seven months after California’s gas prices first topped $5 in March, drivers are finally going to see some financial relief. A long-awaited deal to send $9.5 billion back to Californians feeling the pain of pumping gas – now averaging $6.42 a gallon – has finally worked its way through state bureaucracy.

On Friday, the first direct deposits will start hitting bank accounts, with about 90% of eligible taxpayers receiving hundreds of dollars by the end of October, according to a Franchise Tax Board web page.

The framework sets three tiers of relief payments, with most ranging from $350 to $1,050 depending on income and family size. In order to be eligible, Californians also need to have filed a 2020 tax return.

So how much will you receive?

$350 payments for taxpayers earning up to $75,000 

• The majority of eligible Californians will receive payments under the first tier, which includes rebates of $350 each for single taxpayers earning up to $75,000 and joint filers earning up to $150,000. The state provides an additional $350 to residents with at least one dependent. Under this tier, a single parent or childless couple will get $700, while a joint-filing couple with kids or other dependents will receive $1,050

$250 for taxpayers earning between $75,000 and $125,000

•  The second tier covers taxpayers earning between $75,000 and $125,000 as single filers or $150,000 to $250,000 as joint filers. About 2.1 million people will get $250 each plus an extra $250 for at least one dependent. A childless individual can expect $250, a single parent or childless couple will get $500, and a couple with kids will receive $750.

$200 for singles who earn between $125,000 and $250,000 

• This tier covers 1.1 million filers who earn between $125,000 and $250,000 as single taxpayers, or from $250,000 to $500,000 as joint filers. Residents in this tier receive $200 payments plus an extra $200 for dependents. So an individual filer will get $200, a single parent or childless couple will get $400, and a couple with kids will get $600.

How do I know I’m eligible? 

• The gas rebate program – including the income tiers –  is based on 2020 tax returns. That means eligible California must have filed a California tax return by October 15, 2021. A smaller group of taxpayers who request a taxpayer identification number but did not receive it by October 2021 must have filed their returns by February 15, 2022.
• Taxpayers must have been a California resident for at least six months in 2020 and be a current resident of the state.
• Taxpayers are not eligible if they were claimed as a dependent in 2020.

Taxpayers who e-filed their 2020 tax return should see direct deposits this month

• Taxpayers who e-filed their 2020 tax return and received a tax refund by direct deposit should see a direct deposit in their bank account by the end of this month.

Many other taxpayers will receive pre-paid debit cards in November and December

• The Franchise Tax Board is also mailing pre-paid debit cards to taxpayers who filed a paper return in 2020, had a tax balance due, or received previous stimulus payments by check. Most of these debit cards will be mailed between October 25 and December 10.
• The tax board estimates that 95% of refund payments, including both direct deposits and debit cards, will be issued by the end of this year.