The Peck Group, LC - Tax Law
Free 30 minute telephone consultation
Free 30 minute telephone consultation
email us
Comprehensive Tax Law Representation Since 1995
We handle every aspect of tax law: preparing tax returns, representing clients during audits, resolving IRS and state tax controversies, and creating tax planning strategies for the future.

Why your tax refund might be smaller this year

| Feb 28, 2019 | Tax Law, Tax Law |

Whether it’s contributing to a college fund, fixing a hole in the roof or just funding a vacation, millions of Americans depend on their tax refund every year. For some, it’s more than just extra money towards luxuries. It can be necessary to keep up with mortgage payments or repay debts. If your tax refund unexpectedly dropped, it could devastate your financial plans.

Sadly, this year many people are facing such an ordeal. IRS reports through this month show an average tax refund decrease of over 15 percent, compared to last year’s tax returns. Some people may even owe thousands of dollars they were unprepared to pay.

What causes the decrease

It’s impossible to discuss the changes in tax returns without looking at the 2018 tax reform that just went into effect. One of the most understandable causes of lower tax refunds is this: employers withheld less tax money from most peoples’ paychecks. As a result, some tax payers may have a lower refund this year. Others, who normally receive refunds, may find that they actually owe money this year.

What to do about it

If you had big plans for your tax return, it can be challenging to face a different outcome. It’s too late now to change what was withheld last year, but it is possible to have your employer withhold more going forward.

In addition, filing sooner rather than later will give you more time to thoroughly examine your taxes and get the most money you can. Instead of choosing the standard reduction, consider itemizing your expenses. This could lead to a bigger refund.

We insist that your taxpayer rights are protected and your options are known.

Our services are confidential and are protected under the attorney-client privilege as allowed by law.