Middle Class Tax Refund – Federal Tax Exemption

February 8, 2023

The Honorable Joseph Biden
President of the United States The White House
1600 Pennsylvania Avenue, N.W.
Washington, DC 20500

Dear President Biden:

Nearly 18 million Californians have received the Middle Class Tax Refund from the State of California. To their surprise, they are learning these payments may be taxable by the Internal Revenue Service.

As their elected representatives, we request that your Administration exempt these payments from federal income tax.

California officials have stated that these payments are not subject to state income tax, but they “may be considered federal income.” This has caused confusion and angst among residents. Promised as a payment to help combat soaring inflation, these limited refunds were touted as financial relief to residents — similar to the federal stimulus checks issued during the pandemic. Like the federal stimulus dollars, the refund was issued from taxes paid by Californians. Therefore, California’s Middle Class Tax Refund must be given the same federal tax exemption.

Middle class Californians should not be taxed twice on their own refunds. With tax season officially open, we ask that you act swiftly to ease Californians’ anxiety and to ensure proper compliance.