Tax Time and Shrinking Refunds

The Trump administration and Republicans in Congress missed something important with tax reform, which benefited wealthy people a lot and gave ordinary people a small amount more in their weekly or bi-weekly paychecks. People don’t notice $20 bucks or so per paycheck. The amount doesn’t even register. Not much grounds for excitement or appreciation there.

More to the point, people hate it when their refund checks are diminished. That’s what’s happening as a result of the same tax reform bill, because of changes in the law regarding deductions, or because the IRS changed withholding. All of that was supposed to be a big boost for ordinary taxpayers. Instead, they are furious at what is supposed to be the signature Republican legislative achievement. If you think the IRS ate your refund check, you’re mad, not jubilant.

Actually, no one should want a big refund — it merely means you’ve let the government use your money tax free for the year in question. If your withholding is set correctly, your tax obligation should just about match the amount withheld — neither over or under. But people like refunds. They think, albeit mistakenly, that they are getting a deal.

So people hate tax reform that the Republicans passed — not exactly for the right reason. But any pushback on Republican efforts to help the few at the expense of the many is just fine with me, especially as people have to decide how to vote in 2020.

https://www.washingtonpost.com/business/2019/02/10/millions-americans-could-be-stunned-their-tax-refunds-shrink/?utm_term=.32349f0ee877&wpisrc=nl_most&wpmm=1

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