Taxpayers finding costly surprises in their 2018 returns

Regardless of the motivation, the outcome has been a decrease in tax refunds and an increase in the number of people who owe federal taxes, she said.

“Because they were paying less over the year than they should have been, they’re getting smaller refunds or they’re actually having to pay tax liabilities when that wasn’t the case before,” Austin said.

According to Internal Revenue Service data on federal income tax returns filed nationwide as of March 22, the number of taxpayers receiving refunds decreased by about 2.6 percent from a year earlier, while the aggregate amount of tax refunds was down by nearly $6 billion, roughly 3 percent. However, about 2 percent fewer tax returns had been filed than by March 22 of 2018.

According to the IRS, the average tax refund amount was down by only about $10. Still, Austin said the average doesn’t indicate whether certain groups came out better or worse than others. She cited a recent U.S. Government Accountability Office report that found single-income married couples with children were the most likely group to have their income taxes incorrectly withheld in 2018.

Both Dufour and Austin noted that taxpayers can ask their payroll managers to increase their federal income tax withholding for the current year to ensure they don’t experience a repeat deficit on their next tax return.

Click here to read the full story, first published April 9, 2019, in the Portland Press Herald.