Taxes

Tax Refunds Shrink More Than Previously Reported

JM Ashby
Written by JM Ashby

The Washington Post first reported earlier this month that the average tax refund has dropped by almost 8 percent, but the current situation is much worse than that.

Republicans responded to the earlier reports by blaming the drop on their government shutdown and the backlog it created at the Internal Revenue Service (IRS), but the most recent data tells us the average tax refund has dropped by 17 percent, not 8 percent.

From Politico:

The agency released data late Friday showing refunds are down for the third consecutive week, with the typical payment made through Feb. 15 totaling $2,703, compared to $3,256 during the same period last year.

This filing season is the first under Republicans’ overhaul of the tax code, and lawmakers have already been under fire as some taxpayers find their expected refunds smaller or gone altogether. The payments are sacrosanct to many Americans who rely on them to fill holes in their budgets.

The administration blamed the decline on what it said was a quirk in year-over-year comparisons.

You might say Republicans were right about the backlog at the IRS, just not in the way they thought. The backlog temporarily prevented us from seeing how much the average taxpayer is getting fucked. Clearing the backlog did not make things better.

The idea that this is simply a shock from year-over-year comparisons may be partially true, but this is the new normal or at least it will be for a few years.

The average person may have forgotten by now that the Republican party's changes to the tax code will become even more regressive in the coming years when some of the meager tax breaks included in their tax cut bill expire. The minor tax breaks that softened the blow will expire while the GOP's tax cuts for corporations and wealthy shareholders are permanent.

The next president will take office with a trillion dollar deficit, a tax code that's more regressive than it has ever been, and possibly even a recession. It will be like Groundhog Day, except we'll keep reliving the 2008 election.

  • muselet

    Sooner or later, the Rs will come around to their usual excuse for tax cuts not making everything better: those dastardly taxandspendDemocrats! are responsible.

    Either that or they’ll claim the dog ate their homework.

    –alopecia

  • katanahamon

    Yeah..this headline is the first thing I see after I just got home from dropping off all my stuff to “the tax guy.” Can’t wait…