This year, your tax refund could be a lot lower than expected.
According to HuffPost, tax refunds for the first week of tax season dropped by 8.4 percent from the same time last year. The drop stemmed from the Trump administration's tax law. Since the law was enacted, 30 million people will owe the IRS — a 3 million person increase.
“There are going to be a lot of unhappy people over the next month,” Edward Karl of the American Institute of CPAs told Politico. “Taxpayers want a large refund.”
Lower-income taxpayers file early to receive refunds quicker, but the IRS anticipates a 2.3 percent decrease in the number of tax refunds it issues.
NBC News reports the Tax Cuts and Jobs Act passed in 2017 was supposed to give the average American a $4,000 tax refund. But with changes made about a year ago to the IRS' withholding tables, people are discovering that tax refunds may be smaller, and others are noticing they will have to pay more in taxes than previous years.
The longest federal government shutdown in America history also weighs heavily on the IRS. According to the agency's data, last year there were 6.17 million refunds sent out the first week of the tax season. The number for this year is 4.67 million. IRS workers, who were not being paid during the shutdown, have to make up ground.
“Americans are obsessed with their refunds," Howard Gleckman, a senior fellow at the Urban Brookings Tax Policy Center, told NBC News. "What really matters is whether your taxes went up or down, not whether your refund went down. It’s really important that people don’t confuse their refund with the taxes they pay.”
Gleckman also noted those who work multiple jobs might suffer the most. And in this gig economy, millennials may feel it the worst.
Blavitize your inbox! Join our daily newsletter for fresh stories and breaking news.
Now, check these out:
Senator Introduces 420 Bill To Legalize Weed Nationwide