Tax season is in full swing but many aren’t happy with their returns as refunds shrink while others wind up owing the Internal Revenue Service, or IRS.
They’re the effects of President Donald Trump’s tax reform plan taking full effect.
According to the IRS, the average refund is dropping about eight percent with three million more Americans owing this year instead of getting a refund.
“My husband and I are trying to figure out if filing separate or together is going to be better for us,” said Rochester resident Kayla Bermudez.
One reason is that less money is being withheld from paychecks.
Personal exemptions have also been eliminated.
“What was typically referred to as miscellaneous itemized deductions are no longer allowable,” explained Jim Schnell, a tax professional at Mengel Metzger Barr & Co. “A big ticket item for families in that realm was investment fees and brokerage fees.”
Other deductions that are no longer allowed include:
– Moving expenses, unless you’re active military
– Tax preparation fees
– Employee expenses
– Dependent exemption
Instead, families may qualify for the child tax credit, raised to $2,000 per child.
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