The last blog about refunds elicited numerous responses. Some of the comments referred to political stands. This was neither the content or intent of the post. What many seemed to miss was that having a CPA like Les Merritt looking out for your tax position could have prevented surprises at tax time.
There were reasons for smaller refunds as a number of comments pointed out. Paychecks had less money withheld throughout the year. This modification occurred because people did not review their withholdings with reference to changes in tax brackets. Withholding might have been smaller than in the past. Many saw an increase in pay.
A number of taxpayers kept more of their money over the year reducing the amount the government kept until tax time. Some referred to the fact that since less was taken out. This meant more money in the pockets of taxpayers and less remaining in the hands of government until filing. Others reported feeling the pinch when filing. They did not make the adjustments to their deductions during 2018 and were still relying on a sizable refund (even though they were taking home more pay in their paychecks). Many families have come to expect that there will be a large refund. They plan to use it for vacations, home improvements or some other project. Not getting that refund has upset some, regardless of what their tax burden is for 2018 filing.
The post was in no way in support of or a condemnation of the new tax laws but rather, like previous blogs, a notice of the changes which may or may not have impacted taxpayers. Indeed it has been easy to accuse the changes in the law of being biased toward one view or the other. And the media on both sides have rallied to that call. However, that is beside the point of the blog. What is critical is that the changes to the tax law are some of the most sweeping in years and citizens need to stay informed.
Some will pay less taxes this year, some may pay more. Whether you saved or not, get ready for 2019 taxes and consult with someone who knows about these changes. You may need to change your withholding if you want that larger refund or you might monitor your paycheck and put the extra away where you can earn interest on it. In any case it makes sense to talk with a CPA.
Contact Les Merritt if you still need your taxes done. If you need to start planning for next tax year, Les can help you as well. Les Merritt, CPA and CFP (Certified Financial Planner) is ready to lend assistance. He has helped families and companies for over 30 years with tax preparation and planning. Contact his office at (919) 269-8553 to help you and calculate your refund next year.