IRS: Average Increase in Tax Refunds, Asset Mitigation, Concern of GOP Tax Law



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After three weeks of breathlessness, some Americans have received good news regarding the extent of their tax refunds.

The IRS data on the first three weeks of the tax season showed that the average tax refund amount had significantly decreased compared to the same periods of 2018. In fact, after the third week of the 2019 tax season – which ended on February 15 – the average repayment was only $ 2,640 against $ 3,169 for the first three weeks of the reporting period. 2018 deposit, a decrease of 17%.

But new data from the IRS, released on Thursday, showed that the size of the average tax refund issued has not only caught up until 2018, but it is not the same. also exceeded.

According to the data, the average reimbursement of tax collected during the first four weeks of the reporting period was $ 3,143, up 1.3% from the average of $ 3,103 in refunds made during the reporting period. the same period in 2018.

According to the Treasury Department, the increase is due to the delay in the payment of two essential tax credits.

"As previously reported, the increase in weekly data is mainly due to the balance of earned income tax credits and child tax credits paid this week," said the Treasury in a communicated.

"Despite the higher average refunds, we remind taxpayers that the data for the weekly reporting season are variable and will continue to fluctuate and we do not recommend drawing general conclusions about refunds at the very beginning of the reporting season."

Andy Kiersz / Business Insider

The decline in the amount of repayments has frustrated many Americans. Some have blamed the tax reform law, known as the law on tax reduction and reduction, which was backed by President Donald Trump and Republicans. In fact, people started using the hashtag "#GOPTaxScam" when they lamented smaller repayments.

Although the amount of a refund is not indicative of the amount a taxfiler pays in federal taxes, some Democratic lawmakers, including Speaker of the House of Representatives, Nancy Pelosi, also blamed the law of tax reform the reduction of refunds.

"Once again, American families are feeling the reality behind the empty promises of the GOP tax swindle," Pelosi said on Feb. 11.

Read more: Democrats claim lower US tax refunds are proof that GOP tax law has been violated by the middle class – but the truth is more complex

But analyzes show that a large majority of Americans saw their overall tax burden decline in 2018 and that any reduction in a registrant's repayment was likely due to regulatory adjustments regarding the amount that employers had to remember on employees' paychecks.

According to Daniel Silver, an economist at JPMorgan, catching up the average size of repayments is encouraging given the data of the past few weeks, but does not represent a huge gain for GOP tax law.

"This is a very favorable trend for consumption to see repayments more in line with the experience of previous years after noting the significant lag in data compared to the last daily report," explained Silver in a note to customers on Thursday.

"But if the repayments are simply consistent with those of recent years, this could be considered a disappointment, given expectations that the law on reducing taxation and creating jobs would result in higher repayments this year. year."

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