Millions Stunned and Angry over Changes in Tax Refund Filings

By Bruno Ugaz - Media Director at Advue Consulting 

The IRS has released a report that states many people will be receiving less money this year on their tax returns. 

Tax returns were down during the first week, approximately 8% less than last year. According to IRS data, the average refund check is down by $1,835 as opposed to the $2,035 from the previous year. The IRS is also estimating to issue almost 2.3% less tax returns overall due to the new tax law. 

Ben Williams, a New York lawyer interviewed by the Huffington Post, complained that while earning virtually the same amount, he went from receiving $750 on tax returns last year to owing $4600 this year. 

The Jobs and Tax Cuts Act reduces taxes at almost every income level and simplifies the tax code for most filers. The new tax law also eliminates a few deductions that were used to reduce the amount of a filer’s taxable earnings.

One of the more monumental changes to the tax law is a push for limiting the amount of deductions one could claim for paying state and local taxes. Although the new cap is at $10,000, Williams says that he usually pays three times that amount in local taxes.  

The most recent tax law passed by Republicans in 2017 had zero congressional hearings and gave the IRS little to no time to analyze it.

According to several tax lawyers from H&R Block, the new tax law is extremely vague and unclear. There is a lot of decision-making left for the IRS which comes at an inconvenient time due to the IRS being understaffed. Many tax lawyers recommend that filers turn everything in promptly because the IRS is still deciphering the new tax law.

Ben Williams isn’t the only one with complaints: Many tax filers have taken to Twitter to express their anger with the new tax law after discovering just how much they owed. 

Others are more optimistic; Morgan Stanley released a statement predicting that by the end of the season, tax returns will be 26 percent higher than last year.

"With the change in taxes ... American workers who generally over-withhold each year are now likely to be significantly over-withheld this year," said a Morgan Stanley bank representative.

To avoid any surprises, the IRS is recommending that filers do a quick paycheck checkup.