Did You Get a $400 Inflation Rebate Check This Fall? 5 Best Ways To Spend It
Written by
John Csiszar
Edited by
Jenna Klaverweiden
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If you’re a resident of the great state of New York — or at least, if you were in 2023 — you might get a little cheer in your mailbox over the coming weeks. That’s because the state has begun issuing inflation rebate checks of up to $400 to qualifying residents.
While it’s not exactly a windfall, like some of the pandemic-era money handed out by the government was, it’s certainly going to be appreciated by households struggling to keep up with the cost of living.
Here’s a look at the details of the program, along with suggestions on what to do with the money when you receive it.
Also see whether tariff rebates could help fight inflation.
What Are the Requirements?
The New York relief checks are an attempt by the state to pay back some of the higher sales tax its residents paid in recent years due to higher inflation. Over 8 million New Yorkers are eligible, and the best part is they don’t have to do anything to receive the money. It will be distributed automatically to qualifying residents.
Who qualifies? According to the New York Department of Taxation and Finance, you’ll receive a check if, for tax year 2023, you:
- Filed a New York State Resident Income Tax Return, Form IT-201
- Reported income that fell within the qualifying bands (shown below)
- Were not claimed as a dependent on someone else’s tax return.
Qualifying income bands are based on filing status, as follows, per the New York Department of Taxation and Finance.
| Filing Status | 2023 New York Adjusted Gross Income (Form IT-201, Line 33) | Refund Amount |
| Single | $75,000 or less | $200 |
| Over $75,000, but not more than $150,000 | $150 | |
| Married Filing Joint | $150,000 or less | $400 |
| Over $150,000, but not more than $300,000 | $300 | |
| Married Filing Separate | $75,000 or less | $200 |
| Over $75,000, but not more than $150,000 | $150 | |
| Head of Household | $75,000 or less | $200 |
| Over $75,000, but not more than $150,000 | $150 | |
| Qualifying Surviving Spouse | $150,000 or less | $400 |
| Over $150,000, but not more than $300,000 | $300 |
As you can see from the table, the maximum amount available is $400, while the minimum amount is $150.
When Will My Check Arrive?
New York has started mailing out checks; however, since the number of checks will reach 8 million, the process will take some time.
The New York Department of Taxation and Finance said that mailings are not based on region or ZIP code, so you may get your check earlier or later than your neighbors. The state is not publishing any timelines and explained that customer service agents will not have any additional information about the status of any individual check.
How Should You Use the Rebate?
As everyone has a unique financial situation, there’s no one “right” answer as to how you should use your check. But there are some strategies you could consider.
Counteract Inflation
As this is being framed as an “inflation relief” rebate, it might be a good idea to use it to counteract the effect of inflation in your household budget.
For example, if your grocery costs have spiraled out of control, you can use the inflation rebate check to get some “free” groceries. Similarly, if your transportation or heating bills have risen dramatically, you can use the money to help defray those costs. That way, you’re really using your “inflation relief” check to fight inflation.
Pay Off Debt
Beyond covering your increased household expenses, there are a number of smart options for using the money. Paying off high-interest debt is always a good idea.
If you have credit card balances, you might be facing interest rates of 22% or more. Using your $400 check to pay down your debt is like getting an instant 22%-plus return on that money.
Build an Emergency Fund
Building an emergency fund is another good option, as it can help keep you out of debt when you run into an unexpected cost. This is particularly true in the current economic environment, as analysts at JPMorgan suggest there is a 40% chance of a recession before year-end 2025.
Add Funds to Retirement or Investment Accounts
If you don’t have any debt and your emergency fund is already squared away, add that $400 to your retirement and/or investment accounts. It might not seem like that big of a deal, but $400 invested at an 8% annual rate of return for 30 years would grow by a factor of 11, to about $4,400.
Boost Your Skills
Another option is to use that money to take a course or professional exam to boost your skills and make yourself a more valuable worker.
As famed billionaire investor Warren Buffett has often said, “The best investment you can make is in yourself.” A move like this could get you a raise at work or perhaps even a higher-paying job, meaning that $400 investment will pay for itself many times over.
The Bottom Line
Although you’re free to use the New York relief money any way you choose, there are some smart ways you can use that money to really pay off for you.
While there’s nothing wrong with having a little bit of fun, directing the bulk of the check toward more productive pursuits, like paying off debt, building an emergency fund, or investing in the markets or yourself, can leverage the value of that $400 into something even bigger.
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