The average tax refund check is nearly identical to last year’s average refund, increasing less than 1 percent to $3,068 in 2019, according to the most recent IRS data detailing how taxpayers are feeling the practical effects of the Republican tax overhaul,
Key Insights
The total value of those checks was about $142.4 billion for the week ending March 1, according to Internal Revenue Service data issued Thursday. That’s down 3.5 percent compared to last year. The data represents returns filed in roughly the first half of this year’s filing season. The deadline is April 15 in most states. So far, about 46.4 million refund checks have been issued to taxpayers. That’s down from the approximately 48.5 million who had received them at this point last year. Ultimately, the agency estimates it will send out about 2.3 percent fewer refunds than last year. Last week, the gap narrowed between the average refund check issued in 2018 and this year, after the tax overhaul became effective. For the first several weeks of the filing season, the number, average size and total value of all the checks had lagged behind last year’s totals. In a tweet, the Treasury Department said the levels were consistent with last year and that taxpayers should check to make sure their taxes are properly withheld for next year’s filing season.
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The National Taxpayer advocate, Nina Olson, cautioned in testimony Thursday to the House Ways and Means Oversight Subcommittee that the number of people who ultimately owe the IRS could increase as the filing season continues, because those taxpayers tend to file later in the season. Taxpayers who owe the IRS have already had trouble reaching the agency to receive help about how to pay their bill. Only about 15 percent of calls are answered after a 60-minute wait time, Olson said. Millions of more callers could overwhelm the system, she added. Lower refunds have put Trump administration officials, particularly Treasury Secretary Steven Mnuchin, on the defensive, as taxpayers realized their refunds were much smaller than they had counted on, even if their paychecks were slightly larger. One reason refund checks on average have been smaller is that the IRS withholding tables changed as a result of the new law, so people received their tax cuts throughout the year in the form of less money taken out of their paychecks. About four in five taxpayers received a tax cut last year, according to the Tax Policy Center, but it didn’t necessarily show up as a refund check.
This article was provided by Bloomberg News.