Gov. Kathy Hochul said the funds come from money the state collects with higher sales taxes due to inflation.
New York Governor Kathy Hochul announced the state’s first “inflation refund” on Tuesday. This is a one-time payment to eligible residents.
Hochul said at a press conference that inflation has pushed New Yorkers up costs and that the money should be reclaimed. The funds will come from the money the state collects with higher sales taxes due to inflation, according to the governor.
“As a result, we collected more sales taxes. Unexpected income. We said this could go to the state’s financial resources, but why not give it to residents who came out of their pockets? They paid more than they expected.
Collectively, one-time payments will bring $2 billion back to the pockets of more than 8 million New York taxpayers, Hochul said. Payment amount is based on filing status and income.
Joint tax returners who make up to $150,000 will receive a check of $400, while those who make between $150,000 and $300,000 will receive $300. A single tax returner with a income of up to $75,000 should expect to receive an inflation refund check of $200, while those earning between $75,000 and $150,000 will receive a check of $150.
Hochul first proposed a plan for an inflation reimbursement check last December, securing funding in the 2026 state budget agreement. Her initial plan called for a higher refund, particularly for single filers under $150,000, and $500 for joint filers that make up to $300,000.
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When announcing the inflation refund plan, the governor signed a massive check while announcing the inflation refund. “We’ve done it, guys. We’ve done it,” she told supporters.
As part of the state budget, Hochul offers 1.6 million New York families an annual tax credit of up to $1,000 per child under the age of four and up to $500 per child between four and 16 years old, marking the biggest expansion of New York’s child tax tax in history. The state budget agreement also includes plans to cut taxes by more than 75% for all state tax filers.
New York’s inflation refund check is similar to California’s Middle Class Tax Refund Program. That one-off payment was issued to eligible recipients between October 2022 and January 2023 to provide relief to state residents. The California refund was made in the form of a debit card that requires activation.
