Refunds looking slimmer after tax rate changes
NEOSHO, Mo. — Tax refunds are something many Americans like Wayne Schauer look forward to, but this year is a little different.
“Well, this is my first year of being retired and so I don’t know how that’s gonna be this year,” said Schauer, a taxpayer from Diamond, Missouri.
More questions than answers for Schauer and for CPA’s across the country, adjusting to their own big changes: tax rates lowered, exemptions eliminated and child tax credits doubled.
“Anytime we have a tax law change like this, it’s the best guess estimate that first year because you don’t know exactly how it’s gonna wash out,” explained Brad Taylor, a CPA with Taylor Green Accounting Firm.
So far, filers’ refunds are averaging about $170 lower than last year, and while Taylor says he hasn’t noticed much of a change for his clients, it all depends on your paycheck withholdings.
“If they did not have enough withheld, they could see a lower refund, but I think the overall tax liability that people are seeing is less,” Taylor explained.
Many taxpayers count on their refund for extra spending money.
“We used ours last year to get a new vehicle, and then we did some home repairs and then we took our kids to Branson,” said Calin Laudermilk, a taxpayer from Granby, Missouri.
Laudermilk says she’s noticed a slight change in her refund, though.
“If it is a little less, it might be off maybe $100 or less, but it seems about the same as last year,” she stated.
Georgia Holtz, says her refund will also be smaller, but she’s not too concerned, or surprised, by the tax rate changes results.
“I was just gonna wait and see what kinda difference it made, didn’t make a huge difference, so I doubt I’ll make any changes,” said Holts, a taxpayer from Goodman, Missouri.
No matter how much you do or don’t get back this year, Schauer has some advice.
“Don’t spend all your money. Keep a little back for a rainy day.”
The IRS has processed 26% fewer returns than last year, playing catch up after the record-breaking government shutdown.
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