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Proposed surplus checks, now up to $750, could go out this summer

A pedestrian walks by the Maine State House, Wednesday, Jan. 13, 2021, in Augusta, Maine.
Robert F. Bukaty
AP file
A pedestrian walks by the Maine State House, Wednesday, Jan. 13, 2021, in Augusta, Maine.

Maine taxpayers could receive sizable checks this summer under the Mills administration's plan for divvying up a state surplus.

Last month, Gov. Janet Mills proposed using half of a projected $822 million revenue surplus to give $500 back to taxpayers as a way to blunt the impacts of inflation and the pandemic. Mills then increased the size of those proposed checks to $750 this week after state economists said the surplus appears likely to top $1 billion.

On Wednesday, the governor's chief financial official told the Legislature's budget and taxation committees that checks could start going out in July and would continue into the fall. To be eligible, individuals must have earned less than $75,000 while the income caps would be $112,500 for heads of household and $150,000 for couples filing jointly.

Kirsten Figueroa, commissioner of the Maine Department of Administrative and Financial Services, told lawmakers that the $285 “relief payments” sent out to taxpayers last fall were limited to individuals who worked and, therefore, earned an income during the previous tax year. But the eligibility pool would be widened under the current proposal to include retirees and Social Security recipients, as well as self-employed individuals and business owners whose corporate structures required reporting of business earnings rather than employee income on tax returns.

“The checks will start as soon as July, maybe a little bit sooner because we just did a round and we kind of know what we are doing, and through the end of the year,” Figueroa said.

Ultimately, it will be up to lawmakers to decide how to spend, or not spend, the surplus. Those discussions are just beginning, and Figueroa’s presentation on Wednesday was part of that process.

No one testified for or against the administration’s plan for direct checks to taxpayers. Republican legislative leaders have said they would prefer long-term relief in the form of tax cuts but they have yet to put forward a counterproposal.