Stimulus payments are used by federal and local governments to help eligible individuals cover immediate expenses in times of high economic distress. In addition, this objective is to encourage more spending, and therefore money into the economy to prevent inflation from occurring. This month, residents of Alaska can begin to expect a round of stimulus payments to be made, and timing could not be better with tax season upon us!
When are stimulus payments released?
Stimulus payments can broadly refer to any payment that could take the form of a tax rebate, tax credit, tax deduction, or grant from both federal and local governments. Generally, stimulus payments are more commonly offered by state governments as opposed to widespread national payments. In terms of federal stimulus payments, they are usually always done within the context of tax rebates.
However, during the COVID-19 pandemic, the federal government released three rounds of stimulus payments under the Economic Impact Payments plan. These payments were for qualifying families and individuals who were needing the additional income to cope with the unexpected economic impact the COVID-19 pandemic had on families.
The first two payments were released between March and April of 2020, while the third was released at the same time the following year. However, the IRS is currently in the process of distributing these third payments to eligible individuals who never claimed the payments in 2021.
Alaskan residents can expect a $1,702 stimulus payment
According to the State of Alaska Department of Revenue, the local government is preparing to distribute stimulus payments to their residents worth $1,702. These payments form part of the Alaska Permanent Fund Dividend. Set up in the 1970s, the fund was established to allow for the residents to share in the wealth of the state’s natural mineral and oil resources.
Alaska has a small population of just over 600,000 individuals. Because of this, the state can afford to not limit these payments to residents most in need, but to offer it to nearly all Alaskan individuals regardless of income status.
Each year, residents can apply to take part in the program between January and March. This year, the payments are set to be distributed on March 20, 2025, if you meet the eligibility requirements. While the fund does not have significant entry hurdles, there is still specific qualifying criteria residents have to meet to take part in the program.
Eligibility criteria for the Alaskan PFD
The following criteria are essential to take part in the fund:
- You must be a resident of Alaska
- You must have lived in the state for at least 12 months, and have no plans to be leaving the state
- You must have spent at least 72 continuous hours in the state in the past 24 months if you have a valid reason to be out of state
- You must not have been incarcerated for a felony within the past 12 months
- If you have been previously convicted of a felony or two misdemeanors since 1997, you cannot have any misdemeanors against you in the past 12 months
Alaska continues to benefit its residents
When it comes to fiscal policy, Alaska has some significant benefits for their residents. Not only do you not pay sales tax, the state also provides energy subsidies to eligible individuals. Alaska is the coldest state in the nation, receiving the most annual snowfall. These subsidies help to lower the high heating and energy expenses residents of Alaska have to pay.
In addition, Alaska is one of the nine states which does not tax your retirement income. However, despite these benefits, the state has a high cost-of-living due to its remote location. The state also has limited job opportunities, with the majority of the state being mostly wilderness.
