Tax Refunds Expected To Shrink For Millions Of Americans

As millions of Americans file and complete their 2018 taxes, some have been shocked by a minimal return, including several who are now paying out to the Internal Revenue Service after years of receiving refunds.

Internal Revenue Service

Internal Revenue Service

Photo Credit: CLIFFVIEW PILOT file photo

According to the IRS, the total number of returns received in the week ending on Feb. 1 - more than 16 million - was down 12.4 percent from the week that ended on Feb. 2 last year. Only 13.31 million returns have been processed, down 25.8 percent from the year before.

The average refund of $1,865 was 8.4 percent smaller than the average refund in the same period last year, when it was at $2,084.

The smaller tax refunds come on the heels of new tax laws that were put into place by President Donald Trump’s administration. There was a swift and vocal outcry by those receiving their returns regarding the GOP’s tax reform. Several people posted that their jobs remained unchanged, but instead of receiving a refund, they were told they owe the IRS money.

Despite those facts, the U.S. Treasury Department called the shock over seemingly diminished tax returns “misleading.”

“News reports on reduction in IRS filings & refunds are misleading,” the Treasury Department tweeted, which was followed up with a recommendation for taxpayers to ensure their tax withholding is being done correctly on their paychecks. “Go to the IRS withholding calculator to make sure you are properly withheld and receiving the full benefits of the new tax law.”

The IRS has continually stressed that the early results are a small sample size and not to take too much stock in the early numbers.

“IRS systems are operating smoothly to start the filing season, and refunds are being issued. The IRS encourages taxpayers to e-file as the quickest way to receive their refunds.” 

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