On CNBC Power Lunch, the commentators reported that several U.S. states are experiencing a problem of excess tax revenue, which all agreed is a great problem to have.  They also reported that the states’ dilemma is what to do with the excess collected tax revenue.  While some states have decided to give the excess back to tax payers in the form of a rebate; others have decided to reduce tax rates to their respective state’s taxpayers.

Another option states have employed is to add to their respective ‘rainy day fund’ that increases their dry powder for the inevitable economic downturn.

With a growing U.S. economy hovering about three (3) percent, high employment rates creating more taxpayers and all time highs in U.S. equity markets creating capital gains, states are reaping the benefits of record high inflows of tax revenues.