Fox News tells Americans to stop complaining about their shrunken tax refunds

Josh Israel

Josh Israel Senior Investigative Reporter, Think Progress

As Americans begin to prepare their 2018 federal tax returns, many are facing the unpleasant surprise that their tax refunds will be smaller this year or that they may even owe money to the government. This comes despite — or perhaps because of — the tax bill passed by the Republican Congress in late 2017 and signed by President Donald Trump, which Trump falsely promised would give everyone a tax cut, but actually raised taxes on many middle class Americans.

On Wednesday, Fox & Friends attempted to spin the situation, blaming taxpayers who should have somehow known to have adjust their withholding a year ago and should have saved more.

Noting that the average tax refund has dropped 8.4 percent since last year, guest and Fox Business Network host Charles Payne claimed Americans should have used their “fatter paychecks” more wisely.

“Here’s the thing. For the most part, the IRS is telling everyone that they just simply did not make the proper adjustments on the withholding at the beginning of the year. So they have been making all of this money,” he said.

He added that employers and taxpayers should have known better, because the Internal Revenue Service “put a lot more memos out” about how to recalculate payroll deductions.

“Of course most people didn’t do that. While people were obviously seeing fatter paychecks they were still counting on that refund they always got. Which is interesting because, you kind of hinted at it, that we would allow the IRS to have like a $2,000 loan, our money, right? Hold on to it because we overpaid. So people should probably consider making these adjustments anyway, unless you want to give the IRS two or three grand of your money to hold for a year. Maybe they can make the interest on it and you won’t.”

The “fatter paycheck” claim applies mostly to higher income earners rather than the average American. Most people did not notice a significant increase in their paychecks as a result of the bill, which mostly benefited the very rich and corporations.

Rep. Kevin Brady (R-TX), lead author of the tax bill, also tried to persuade taxpayers to be grateful for their diminished returns this week, tweeting a misleading claim that tax refunds had nothing to do with the overall tax bill.

“Refunds are a sign you’re overpaying the IRS monthly,” he wrote. “Most Americans got tax cut in 2018 paychecks — when needed the most. 90% of middle class got [a] $2,100 [average] tax cut.”

Rep. Warren Davidson (R-OH), who backed the bill, incorrectly claimed that tax refunds are down because most people “owed less income tax.” And Sen. John Cornyn (R-TX), who helped push the bill through the Senate, argued “less taxes = less withholding = less refunds” — a gross oversimplification.

According to the Tax Policy Center those in the bottom 20 percent of earners likely saw an average tax cut of about $60 total for the year. The next 20 percent could expect just a $380 total cut, while the top 0.1 percent of Americans saved an average of more than $190,000.

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Reposted from ThinkProgress

Josh Israel is a senior investigative reporter for ThinkProgress.org at the Center for American Progress Action Fund. Previously, he was a reporter and oversaw money-in-politics reporting at the Center for Public Integrity, was chief researcher for Nick Kotz’s acclaimed 2005 book Judgment Days: Lyndon Baines Johnson, Martin Luther King Jr., and the Laws that Changed America, and was president of the Virginia Partisans Gay & Lesbian Democratic Club. A New England-native, Josh received a B.A. in politics from Brandeis University and graduated from the Sorensen Institute for Political Leadership at the University of Virginia, in 2004. He has appeared on CNBC, Bloomberg, Fox News, Current TV, and many radio shows across the country.

Posted In: Allied Approaches

Union Matters

A Just, Inclusive and Sustainable Economy

From the AFL-CIO

This week, labor leaders from across the country descended on New Orleans to map out the path ahead for our movement. From trade and public education to equal pay and paid leave to back pay for federal contract workers and bargaining power for all, the AFL-CIO Executive Council tackled the issues that will define working people’s fight for economic justice in 2019 and beyond.

Sending waves through Washington yesterday, the Executive Council’s most notable decision was its announcement that, “if the administration insists on a premature vote on the new NAFTA in its current form, we will have no choice but to oppose it.” Here are a few highlights from the statement:

  • Trade policy must be judged by whether it leads to a just, inclusive and sustainable economy....By that measure, the North American Free Trade Agreement (NAFTA), which has driven the outsourcing of so many good jobs, has been a catastrophic failure. More than 850,000 U.S. jobs were shipped overseas under NAFTA between 1993 and 2013.
  • By design, NAFTA distorted power relationships in favor of global employers over workers, weakened worker bargaining power and encouraged the de-industrialization of the U.S. economy.
  • After a quarter-century of this race to the bottom, workers in all three NAFTA countries find it more difficult to form unions and negotiate collective bargaining agreements.
  • The NAFTA renegotiation requires strong labor rights provisions and strong enforcement provisions that as of today are not yet in the agreement.
  • The current effort by the business community to pass the new NAFTA is premature, and if it continues, we will be forced to mobilize to defeat it, just as we mobilized to kill the Trans-Pacific Partnership.

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New NAFTA Must Create an Economy for All

New NAFTA Must Create an Economy for All