Trump Tax Cut

[Bill the Cat]

That's a tough road to hoe. I'm curious - do you think any of this experience colors your visceral response to so many of the issues we've discussed?

Probably.

Kids are the blessing and bane of our existence... Sometimes more the former - sometimes more the latter....

That's gospel truth!!

[carpedm9587]

Probably.

That's gospel truth!!

Imagine that! And you heard it from a heathen.

[Mountain Man]

Source: Fact Check: Democrats Are Misleading Americans About Their Tax Refunds

Democrats looking to score points against President Donald Trump this week focused attention on data from the government that showed refund checks going out to early filers were smaller than they were a year ago.

Sen. Kamala Harris (D-CA) falsely claimed that smaller refunds indicated that the tax cuts amounted to a “middle-class tax hike.”

The smaller refund checks, however, were not indicators that taxes have gone up. In fact, two-thirds of American households got a tax cut this year. For middle-class families with children, over 80 percent got tax cuts.

A smaller refund check merely indicates that early tax-filers overpaid their taxes by a smaller amount throughout the year. In other words, taxpayers kept more of the money they earned — that is, money they did not owe to the federal government.

https://www.breitbart.com/economy/20...early-refunds/

© Copyright Original Source

[guacamole]

Source: Fact Check: Democrats Are Misleading Americans About Their Tax Refunds

Democrats looking to score points against President Donald Trump this week focused attention on data from the government that showed refund checks going out to early filers were smaller than they were a year ago.

Sen. Kamala Harris (D-CA) falsely claimed that smaller refunds indicated that the tax cuts amounted to a “middle-class tax hike.”

The smaller refund checks, however, were not indicators that taxes have gone up. In fact, two-thirds of American households got a tax cut this year. For middle-class families with children, over 80 percent got tax cuts.

A smaller refund check merely indicates that early tax-filers overpaid their taxes by a smaller amount throughout the year. In other words, taxpayers kept more of the money they earned — that is, money they did not owe to the federal government.

https://www.breitbart.com/economy/20...early-refunds/

© Copyright Original Source

Without more context, it's difficult to say what it means. In isolation, a smaller or larger return, divorced from year to year comparisons about the amount taken from a person's pay check, is meaningless. If the same amount is taken this year as opposed to last year, and the return is smaller, then the person did indeed face a tax hike. If a lesser amount is taken this year as opposed to last year, and the return is smaller, then it depends on the rate returned as to whether the individual is flat or gaining. I haven't read any wider studies about the effects from a reputable, non-partisan (meaning, not taking the words of politicians from either party) source about it. I'd love to read one if someone has one available.

[Mountain Man]

Without more context, it's difficult to say what it means.

That's why I included a link to the rest of the article. It goes on to say...

Tax filing season kicked off on January 28, marking the first time taxpayers were filing their returns under the Tax Cuts and Jobs Act. The first refund checks went out last week, and data from the Internal Revenue Service (IRS) showed the average refund had declined 8.4 percent, to $1,865, for the week ending February 1.

A large refund check might seem like a bonus to some taxpayers but it is merely a sign that taxes were overpaid during the year. Essentially, a taxpayer who gets a large refund gave an interest-free loan to the government. That money would have been better used if it had gone toward paying down bills or had been saved in a bank account that paid interest.

...

A tax cut is a reduction in what people owe the government for the year, compared to what they would have owed on the same income in the prior year. Thanks to a larger child tax credit for 2018, families with children will pay much less in taxes and many more will owe nothing at all.

A family with an expected zero-tax liability, however, would also likely receive no refund if it perfectly estimated its taxes; although, about two-thirds of households do overpay and receive refund checks. This is especially true immediately following tax cuts because many taxpayers do not reduce their withholding enough to fully account for the cut. On average, refunds will be larger this year than last year, according to estimates by the U.S. Treasury.

But because the Trump administration was eager to deliver the benefits of the tax cuts, the IRS changed its default settings for calculating how much was withheld from each paycheck. As a result, many households have already received their tax cuts and will not see them in the form of larger refund checks.

[Littlejoe]

Kids are the blessing and bane of our existence... Sometimes more the former - sometimes more the latter....

Grandchildren...God's gift to you for not killing your own...

[guacamole]

the IRS changed its default settings for calculating how much was withheld from each paycheck. As a result, many households have already received their tax cuts and will not see them in the form of larger refund checks.[/box]

That was useful and is echoed and explained here as well:

https://www.irs.gov/pub/irs-pdf/p5307.pdf

Pages 3-5 being the relevant part.

However, that doesn't change " If a lesser amount is taken this year as opposed to last year, and the return is smaller, then it depends on the rate returned as to whether the individual is flat or gaining. "

Furthermore, individuals in high tax states may have faced some problems. I'm still looking for a good source on that.

[Sparko]

Without more context, it's difficult to say what it means. In isolation, a smaller or larger return, divorced from year to year comparisons about the amount taken from a person's pay check, is meaningless. If the same amount is taken this year as opposed to last year, and the return is smaller, then the person did indeed face a tax hike. If a lesser amount is taken this year as opposed to last year, and the return is smaller, then it depends on the rate returned as to whether the individual is flat or gaining. I haven't read any wider studies about the effects from a reputable, non-partisan (meaning, not taking the words of politicians from either party) source about it. I'd love to read one if someone has one available.

You have to compare the Total Taxes Owed after deductions (line 15 on 1040) on the returns (making allowances for any actual pay raises between years)

[Sparko]

That was useful and is echoed and explained here as well:

https://www.irs.gov/pub/irs-pdf/p5307.pdf

Pages 3-5 being the relevant part.

However, that doesn't change " If a lesser amount is taken this year as opposed to last year, and the return is smaller, then it depends on the rate returned as to whether the individual is flat or gaining. "

Furthermore, individuals in high tax states may have faced some problems. I'm still looking for a good source on that.

State taxes are not part of the federal income tax and are done on separate forms and have separate payments or returns. My state return this year is the same as it was last year.

[guacamole]

State taxes are not part of the federal income tax and are done on separate forms and have separate payments or returns. My state return this year is the same as it was last year.

Trump's tax reform reduced deductions helpful to people in states with high state income tax. While they are separate, the cause and effect is linked here.

[Sparko]

Here is my final result.

because of a raise and Trump's tax break my taxable income this year was +$2,000 over last year.
But my taxes owed after deductions this year was actually -$400 compared to last year.
And I even used the standard deduction. I used itemized last year.

So thank you Trump.

[rogue06]

Here is my final result.

because of a raise and Trump's tax break my taxable income this year was +$2,000 over last year.
But my taxes owed after deductions this year was actually -$400 compared to last year.
And I even used the standard deduction. I used itemized last year.

So thank you Trump.

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[carpedm9587]

Here is my final result.

because of a raise and Trump's tax break my taxable income this year was +$2,000 over last year.
But my taxes owed after deductions this year was actually -$400 compared to last year.
And I even used the standard deduction. I used itemized last year.

So thank you Trump.

Track it over the next couple years. That "boost" you just got is designed to fade.

And your $400 gain is a fraction of 1% (unless you make less than $40K). Compare that to the almost 3% gain the wealthiest got on average.

You're being duped, Sparko.

[NorrinRadd]

Track it over the next couple years. That "boost" you just got is designed to fade.

And your $400 gain is a fraction of 1% (unless you make less than $40K). Compare that to the almost 3% gain the wealthiest got on average.

You're being duped, Sparko.

The Politics of Envy -- Satan's favorite tool since Eden.

[firstfloor]

Whyisthishappening podcast, can we tax the rich? Interview with Jesse Eisinger. Essential ‘tax’ listening.