What is America’s Debt Ceiling?

Have you ever wondered what America’s Debt Ceiling is? Have you wondered why the debt ceiling has been raised so many times in the past? If you have, then you’re not alone. With the news media covering America’s debt ceiling on an hourly basis, it’s no wonder we’re wondering what exactly it is.

America’s debt ceiling is a limit set by Congress on how much money the federal government can borrow. America’s debt ceiling limits total government debt that the United States can assume, assuming current policies remain unchanged. This amount has been rising steadily since World War II and has reached 16 trillion dollars equivalent in January 2011. According to a nonpartisan Tax Policy Center study, nearly 40 percent of Americans (47.3 million people) have some debt, with average annual payments exceeding 50 percent of their income in 2009. Yet, taxpayers across all income groups have experienced little change in their share of total outstanding taxes over time.

According to a new study, Americans owe more on their credit cards than they owe on their houses, cars, and other items of personal value. In addition, the average American carries debt for nearly all private expenditures except retirement payments, student loans, and medical bills.

America’s debt is rapidly approaching the ceiling, and Congress must decide if they will raise it and by how much.

What happens if we default on our debts?

How is America’s debt ceiling problem affecting you? Amazingly, the debt ceiling debate doesn’t affect Americans who already have debts. Instead, it affects everyone who will be paying off their debt in the future. This means that your credit score might be affected, but it won’t be due to the impact of your debt on the economy. Instead, it will be a traditional — and highly unattractive — factor that may delay your economic recovery.

There are many dire consequences of defaulting on your US or federal debt. You could lose your car, your home, your Social Security benefits, and even your job. The good news is that you only default once. However, once we begin to default, we enter into a period known as ‘default tourism.’ This is where people from all over the world rush to have a chance at getting their debts forgiven by the US government or by a court before we pay them off.

What happens if our creditors decide that it is no longer profitable to pay us what we owe them? The United States has a highly punitive debt ceiling. If the government doesn’t cut its budget, it will default on its debts and cause a panic that could cause a recession. What happens if the United States goes over the debt ceiling? The consequences could be enormous economic hardship on a scale not seen since the Depression.

One of the most effective ways to fight the national debt is to make it harder for the United States to borrow more money. We recommend that Americans resist the temptation to engage in “borrowing for the sake of borrowing” as a way of life. Instead, we should be focused on creating new opportunities and investing in ways that create jobs and limit our obligations. This will ensure that existing revenue streams are not used to create more debt and leave future generations with greater levels of debt.

Other options for dealing with America’s debt ceiling — all of them bad. First, we could increase taxes on wealthier households; second, reduce spending on programs that don’t help people who need it (healthcare, education, etc.); and third, increase taxes.

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What is the Main Goal in Creating the Federal Budget?

Hello there, today I’ll be talking about the main reason the Federal budget was created. Without wasting much time, let’s roll. 

Why was the Federal Budget Created? 

The United States Constitution, the First Article’s 7th section, has congress the power to spend and raise revenue. There were about three ejected officials who presented the voters’ will. Those do not stay in offices. Congress needs to agree on where, when, and how the burden of the tax falls. It also needed to decide who received the spending benefit. This budget puts in very hard numbers on where the priorities were. The entire budget allocated funding specifically for each program and its department. 

The process of budgeting made sure every congress’s voice was heard. These provided great debating opportunities. Whenever Federal Government’s budget is followed according to plan, the entire government runs smoothly without little or no problems at hand. 

What would go wrong if the Federal Budget is not Followed 

You don’t want to run your nation like a low-income developing country, trust me. Since the year 2010, congress has followed the national federal budget only twice. Some experts argued that this budget is not workable and cannot be followed no matter how they tried. At first, they shifted the budgetary leadership burden to congress. It was not workable because the burden was too high, and congress had many other things it was handling. The congress body was not structured enough to handle a leadership role.

Secondly, it demanded coordination levels which congress was not created to catch up or meet up with. 

Third, it created deadlines that were impossible, not realistic, fake, and unattainable. 

The events which came forth from the elections at mid-term in the year 2010 supported that argument. The republicans were winners in the house as a result of the tea party movement. Democrats controlled the presidency and the senate. These republicans did not want to support the budgets, as stated by Obama. This forgot about the process of making use of the federal budget. There they used the budget as a bargaining chip to achieve all of their goals. 

My thoughts on the Main Goal in Creating the Federal Budget?

After learning what happens in low-income developing countries, I have realized that nations don’t need to create or use federal government budgets. These budgets are completely unnecessary. There should be bodies, like assigned bodies, who have roles in various ways that could help the society, the communities, states, and the country as a whole. There are different parts of the country, am I right. Why should a federal budget be created to govern and rule the entire nation? What is then the purpose of the president or the governors or the members of congress? Let’s not forget about the senators. What also happens to people, individually and specifically. What happens when the budget doesn’t touch them, and they suffer from a lack of food or clean water. Stable sources of governance are needed instead of using the federal budget, please.

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Why Do I Owe Federal Taxes?

This is a question asked by practically every American. Like why do you owe federal taxes? What did I do? Who did I wrong? Well, this article might answer this serious question. Let me give it a go, shall I? 

What are the reasons I’m told I owe Federal Taxes? 

Whenever you finish handling the tax returns, and you don’t understand why you need to send a cheque to the IRS, one of the only explanations is that you didn’t pay them completely the amount you owed them. The amount of tax you paid during the year was more than the actual amount you paid or the amount of your income level. This is why whenever you think you’re done, it always shocks you, and you wonder, “Why do I still Owe Federal Taxes.”

Other ways you might still owe federal taxes 

Starting in 2018, different exemptions occurred dependently on others, and they were not taken from your income. 

If you work for a firm, company, or organization, the IRS would need your employer to hold some of your salary used to pay your taxes. The number of funds held would depend on different factors. You have a lot of control over the number of funds that are collected from your pay. The W-4 form you filled when your job started allows you to modify how much tax you have from your paychecks. The essential news is that you could always fill out a brand new form whenever you desire. You could increase the amount taken from your income. This would help get rid of that nasty tax bill that accrues at the end of the year. 

If you are not familiar with what the W-4 form is all about, you need to understand the way allowances work before you go and make some adjustments. All allowance you report represents various reductions in your taxable income. Some of these include exemptions dependent on your amount of tax through periods before the year 2018. As you try to get your tax returned, more allowances reported on your form would state that a lower amount of tax has been held from your paycheck. If you report for a higher amount of allowances on your W-4, there are several dependents obtained from your tax return. You could later write a check whenever the IRS comes over in the future. This is simply an example. 

Several different scenarios using the W-4 calculator could test these using calculator available at TurboTax.com. 

My thoughts on the reasons you owe Federal Taxes 

Where I come from, we don’t have the normal tax-paying system. All tax forms are added to every and anything we purchase. It doesn’t matter what you purchase. You could purchase food seasoning, a bucket, a broom, and it wouldn’t matter. You still end up paying tax on that product. It is not fair, but this is the world we live in. We need to pay up and let it go.

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What are Federal Block Grants?

Today I’ll be talking about federal block grants. But what are these federal block grants? Do you have any idea what they are or their use, or why the government created something like this in the first place? If you don’t, I’m here to talk about it and explain a thing or two to you. Are you ready? Let’s ride. 

Federal Block Grants Definition 

A federal block grand refers to a grant which aids different local governments or individual states from the United States. These grants are available to help in support of a variety of purpose programs. These programs include community development, public health, and social services, law enforcement. These block grants have a lower level of oversight from the federal government. They provide a high level of flexibility in different states. Especially when it comes to implementing and designing different programs, these general revenue, definite, and block grants are the three types of federal government grants which aid different programs. 

All through the block grant program provided by Medicaid, a state would get some money from the federal government. These block grants could be organized based on per capita or from the state’s needs. These states need to fill any or every funding gap if there is to be any difference between their spending and the level spent by the government of the United States of America. 

These block grants remain a debated topic in the U.S. The 2014 CRS (Congressional Research Service) has advocated and changed Medicaid to a block grant. It has also stated that these block grants help reduce the federal deficit, aids in increasing the rate of efficiency by the government, help in the redistribution of power, allow flexibility, and increase the rate of accountability. 

Different critics specifically are against changing Medicaid to a block grant. 

Why do these Critics fight against converting Medicaid to a block grant? 

These critics are wits and win against Medicaid becoming a block grant because it doesn’t profess the national government’s objectives. It doesn’t publicly announce what the government is doing to help citizens in the country. It also reduces the rate of government spending on domestic issues, for example. Vulnerable seniors or citizens suffering from disabilities and children with parents with a low income could lose all available access to health care because of the deep cuts that could go through Medicaid. Their critics state that as a result of these block grants, they remain decentralized. Because of this, it is quite challenging to measure the performance of block grants and hold local and state government officials accountable for all of their decisions. 

In the end, you now know what these federal block grants are. You also know the kinds of arguments that go around the white house. Citizens are living in the U.S are going through hell. It isn’t all rainbows and sunshine there. Here’s to hoping for the best and wishing the nation would do what is right. 

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Why Were U.S. Stimulus Checks Delayed for Social Security Recipients?


Recipients of Social Security checks and several other Americans that don’t file taxes could expect their stimulus payments to get processed this weekend. There’s the treasury department and it announced that on Tuesday. Several payments got sent electronically and they entered bank accounts on the birthday of this writer, 7th of April. 

All through the IRS, it started issuing the third payments for stimulus reasons in the middle of March. These deposits from about thirty million people that received the Social Security checks got delayed. This article would be explaining why it got delayed. 

It got delayed because the Social Security Administration lagged from sending the Internal Revenue service the necessary information it is needed. 

The IRS got information last week after some lawmakers pressured the SSA to send the necessary information.

If any other issue is absent, the Internal Revenue Service would with immediate effect complete their jobs and start processing the files necessary for payment at the end of the week. That’s what the agency stated when conversing with the public. 

Several people in the group would get their payments straight to their bank accounts. Either through direct deposits or Direct Express cards. 

The IRS could get my payment tool would get updated as soon as these payments get processed. This would not be till the weekend. Some beneficiaries are from the federal government. These would not get their payments till the next week. 

All about Social Security Recipients 

It’s nice to be a Social Security Recipient. Like, I would just love to be a fly on the wall when my electronic credit alert comes through. It’ll be nice, to be honest. 

What are these stimulus checks for anyway 

You do know that the pandemic has affected a lot of people in ways you can’t imagine right. These social security checks are for people that were simply trying to live their lives when the pandemic came and chased them home. It is a means for them to survive and to keep thriving. That should simply be it I guess.

Who are the recipients Of these social security Stimulus checks 

Anyone and everyone. The thing is. It depends on the kind of job you were performing before the pandemic started. This is important to know the amount of check you’ll be receiving. I don’t think everyone gets the same amount. Do you understand?

My thoughts on Why Were U.S. Stimulus Checks Delayed for Social Security Recipients?

I don’t like it when I am promised money at a time and a date and then when the checks are supposed to come, it gets delayed by one thing or the other. Honestly, it is very painful. Especially in this case that these recipients of these funds are really in need of it. Times are difficult now, delay in sending funds and obtaining checks is not funny. The IRS should do all they have to as soon as possible.

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Will I Have to Repay the U.S. Federal Government for My Stimulus Checks?


On the 12th of February, tax filing season is going to come. Several different Americans that have qualified for stimulus checks and those who have not received them have been gathering their paperwork to claim missing amounts from their federal tax returns. What if you might have been on the other end of this scale and then the IRS mistakenly sent you money as you wanted to leave honestly speaking. Is one required to return this, would these same rules get applied to a third stimulus check.

If you for payment for the stimulus that you were not supposed to get, you might have made more than the limit of income. If that is the case, then the IRS would honestly expect you to send the funds back. When the first stimulus checks round goes out through a year. The IRS has stated that in more cases, it might have accidentally sent these payments to people that were not truly eligible. This second round of checks might have been pushed out quickly. It could be possible that these same errors might have occurred again. These all depend on how quickly one got the stimulus payments. If one is checking using papers, or an EIP card, or by getting a direct deposit. There are several different ways one can go about getting these returned. 

Here there are more situations than one with which the IRS could want you to return a stimulus check that has been paid out in error. There are different specifics on how you could check these. It is very important to know if your stimulus check rights and there are key details about these stimulus taxes and checks. Here are the things that are happening using a potential third stimulus check. Here some lawmakers would want to target these payments. Also to know the amount of money which the new check would bring and how much of it can get approved. These stories have been updated recently. 

Several different situations would require you to return your payments to stimulus. 

Types of situations that you need to Return Your Stimulus Checks 

In this case, why did you get a stimulus check in the first place? Was there a pandemic? Did you get locked in your apartment with no way to go and hustle and make your money? Did you need to feed but there was no money to do so because of the conditions I mentioned above? 

If you suffered from all of these then you should know that after you have started getting your usual forms of income, or if the pandemic has started going away, or you are no more locked in your homes and normal life has resumed. You know for sure that you need to in peace return these stimulus checks back. Even if you weren’t asked for it, it is common decency. Believe that whatever goes around, comes around.

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What to Do if You Haven’t Received Your Stimulus Check Yet

The stimulus check refers to a certain amount of money approved by the presidential administration. There have been more stimulus checks due to the effect of the covid-19 pandemic on the economy as well as the people. These checks are necessary because unemployment rates are currently high. Stimulus checks include benefits and funds for Americans who may be struggling.

If you have not received your stimulus check yet here is what you should do. Before outlining the steps you should take, we need to discuss some of the reasons that may lead to you not receiving your stimulus check.

  1. Improper Application – To get the stimulus check you have to enter your information into the IRS Website. This is the only site that will require your information. Be wary of scams or fraudulent activities surrounding the stimulus check. If the information is not coming from the IRS then it is most likely not trustworthy.
  1. Taxes – A new ruling that permits those who haven’t filed their tax in 2018, 2019, and 2020 to still be eligible for the stimulus check however, the application of this ruling differs in states.
  1. Under 16 and 18 – If you are under 16 your parents or guardian should receive your stimulus check because you are under their care. This will only occur if they include your details in the information given to the IRS. For individuals under the age of 18, if your parents do not legally state that you are a “dependent” your family will not receive your stimulus check.
  1. Wage Limits – Not all wage earners will qualify to receive the full stimulus check and this is solely based on your tax returns. Individuals who earn less than $75,000 or $150,000 as a couple are eligible for the stimulus check. After this, for every $100 in income above the threshold will result in $5 being deducted from the stimulus check. If an individual earns $87,000 and above or a couple earns $174,000 they will not qualify for the stimulus check because they are high wage earners.

For heads of households (this has to be stated on tax returns), there will be no stimulus check if the gross income after adjustments is above $124,500.

  1. Recent Address Change – If an individual chooses to receive the check by mail and change addresses, it could take up to 5 months to arrive. This is why your information on the IRS Website should always be up to date.
  1. No Bank Account – Most stimulus checks are deposited directly into the bank account registered on the IRS Website. If you do not have one then you can get the check sent by mail which will take a few months to arrive. If you opt to receive it by cash through the app Cash App and a prepaid debit card.
  1. Immigrants without a Social Security Number – Immigrants without a social security number do not qualify to receive the stimulus check. Those with H-1B or H-2A visas and Green Cards are eligible.

If none of these apply to you and you still haven’t received your stimulus check, follow these steps.

  1. Track your payment status on the IRS Website through the Get My Payment.
  1. Ensure all the information registered is correct. You may have registered an incorrect bank account.
  1. Reach out to your bank to ascertain whether they are still processing your stimulus check.
  1. If you are getting a message stating “Payment Not Available” then you will have to state this in your tax returns (by the 15th of April 2021) to get your “Recovery Rebate Credit.” 

For more information on how to claim the rebate on your tax returns click here.

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‘Where Does the Unemployment Money Come From?’

Unemployment money or more accurately unemployment benefits/unemployment payment/unemployment insurance/unemployment compensation is routinely scheduled payments given to unemployed people by authorized bodies such as governments.  If you’ve ever wondered where does the unemployment money come from, then this is the article for you.

In the United States of America, unemployment money comes from several places. It comes from a compulsory insurance system that is financed through a partnership between the federal and state governments. The Federal Unemployment Tax Act (FUTA) tax which demands that 6 percent of the first $7,000 of protected workers’ earnings is one of the sources of unemployment benefits. It is also financed by the federal fund, unemployment insurance taxes that differ from state to state, and general payroll taxes.

The first instance of unemployment money can be traced to the National Insurance Act of 1911 in the United Kingdom. It was introduced by H. H. Asquith of the Liberal party government. They introduced it to counter the rapidly growing popularity of the Labour Party among the United Kingdom’s working-class population. When it was first introduced, the opportunity was only available to people who were already earning wages during illness and unemployment. Those who did not already earn wages did not qualify for unemployment benefits. In the UK, the idea of unemployment benefits had mixed reactions. Communists argued that it would divide and prevent the working class from starting revolutions while others agreed that although it had many disadvantages, it was necessary. The unemployment benefits scheme was first funded through the collection of a fixed amount from taxpayers, employers, and their workers. When it was first introduced, the benefits were restricted to more dangerous industries such as shipbuilding. If a worker was unemployed for more than one week, the worker could apply to receive 7 shillings a week for up to fifteen weeks uninterrupted.

In the United States, unemployment benefits are available in all 50 states, the District of Columbia, the United States Virgin Islands, and Puerto Rico. The eligibility requirements and payments vary from state to state. However, eligible workers can get as much as $783 in Massachusetts per week and as low as $235 in Mississippi. To be eligible for unemployment money, you have to meet the requirements of your state. As earlier stated, they vary; however, there are general rules set in place. They are:

  1. If you quit your job voluntarily you may not be eligible for unemployment benefits.
  1. If you were fired from your job due to misconduct, then you may not be eligible for unemployment benefits. Misconduct in this case applies to actions happening inside and outside your place of work.
  1. To be eligible for unemployment benefits you must be temporarily unemployed and your unemployment must not be as a result of your actions.

In the US, there is no waiting period. Some countries have a waiting period of up to seven days; however, the United States doesn’t have one. The rates of participation are very different in states; however, estimates have shown that less than 30% of Americans who are unemployed (who are also still searching for work) receive unemployment benefits. In the 72 countries that offer unemployment money, there is something called a PBD. PBD means potential benefit duration, and it is the maximum amount of time eligible people can consistently receive unemployment benefits. In the United States, the PBD is six months.

We hope this article has answered your question on where the unemployment money comes from and more.

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What President Trump’s Payroll Tax Holiday Means to Your 2020 Tax Refund

On the 8th of August 2020, President Trump signed an executive memorandum that directed the Treasury Secretary to commence a payroll tax holiday. The title being used in headlines is quite misleading because it is not a holiday but rather a deferral. The actual title of the memorandum makes this clear. The memorandum is titled “Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster.”  Just like the stimulus check, the payroll tax deferral is a way to ease the economic effects of the global pandemic on the workers. Even though unemployment has dropped to 8.4%, it is nowhere near the 3.5% of February. With that being said let’s get into the details of the payroll tax holiday.

The payroll tax deferral only applies to Americans making less than $104,000 a year, and it deferred four months of taxes (September-December 2020) to January-April 2021. This is just as stressful as it sounds. The tax holiday simply means you’re going to have to pay double the amount from January to April 2021. This means the social security tax percentage will go from 6.2% to 12.4%. The payroll tax holiday is essentially a zero-interest loan (without accounting for inflation).

This memorandum has drawn a lot of criticism because although the President signed it, there are no laws or guidelines that stop employers from continuing to deduct tax from the employees. Employers argue that they would still have to pay said amount even if the employee quits before January 2021. It is also important to note that for most low-wage workers, the tax holiday holds less appeal in the face of the looming payment dates in 2021. Many people would prefer the payroll taxes continue to be removed regularly as opposed to having double the amount removed in the first four months of 2021.

Even though the memorandum directed the Treasury Secretary to explore ways to forgive the taxes of the tax deferral, there have been no bills or legislation to support or discuss this. The memorandum still clearly states that deferred taxes must be paid:

“An Affected Taxpayer must withhold and pay the total Applicable Taxes that the Affected Taxpayer deferred under this notice ratably from wages and compensation paid between January 1, 2021, and April 30, 2021, or interest, penalties, and additions to tax will begin to accrue on May 1, 2021, with respect to any unpaid Applicable Taxes.”

Now you may be wondering what the payroll tax holiday means for your 2020 tax refund. Well, we’re not too sure what’s going to happen. The IRS usually starts accepting tax refund forms by February, and the deferred payroll tax will be paid from January to April.

There is a chance your tax refunds may be lower if you file early. The details aren’t clear yet because the IRS has not released a statement addressing this. We can only assume that tax refunds will be affected by the payroll tax holiday. Perhaps the deferred tax payroll payments will result in a higher 2022 tax refund.

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