Taxpayers expecting a larger refund or a refund at all from Uncle Sam may have suffered through a day of reckoning on Monday.
The IRS filing deadline arrived with Congress’ 2017 tax cuts in the rearview mirror. But some Americans, particularly those who did not adjust their withholdings, may wonder where the money went. Many taxpayers and occasionally the IRS itself seem dazed and confused, said local tax preparer Bruce Brown.
An estimated two-thirds of Americans have seen their income taxes go down due to the tax cuts, according to the Tax Policy Center. Meanwhile, H&R Block reported Monday in an email response to questions that its clients have seen a 24.9 percent decrease in tax liability on average this year.
But the tax-preparation giant said its surveys show nearly 80 percent of Americans did not update their W-4 last year, “resulting in a bump in their paychecks throughout the year, sometimes more than their taxes decreased.”
Parsing those numbers, it said tax liability dropped $1,200 per taxpayer on average, but refunds rose just $43, meaning an average of $1,156 went into paychecks during the year beginning in March 2018.
That’s about $50 per two-week pay period during the last tax year.
Ollie Hartgroves, who has been preparing returns five decades at Hartgroves Tax Service, said his blue-collar clientele pays heed to taxes once a year.
“All are getting back less money than the year before, but they are taking home more money each week than the year before,” Hartgroves said. “I discuss the situation with them, tell them to tell their employer to take more out of their check. They’re not confused once they’re informed.”
Tax reform represented the largest change to the tax code in 30 years. Meanwhile, the Internal Revenue Service changed withholding tables in February 2018, automatically adjusting take-home pay. All these moving pieces, according to H&R Block, “have made it hard for people to understand the (tax cut) impact on their individual situation,” said its email response.
Bart Hatfield, a Houston volunteer with AARP’s Tax-Aide program, with supervisory responsibilities in Texas, New Mexico and Colorado, said he has seen a decline in the number of clients itemizing their taxes since changes in the tax code doubled standard deductions to $24,000 for married couples filing joint returns, $18,000 for household heads and $12,000 for individuals.
“Typically 8 to 10 percent of our clients itemize. Now it’s less than 1 percent,” he said. “The child tax credit, which increased from $1,000 to $2,000 per child, helps a lot of our low-income families with children.”
He echoed comments from others about the importance of withholdings.
“People often equate taxes owed with refunds,” he said. “They jump to conclusions if the refund goes up or down. We explain the difference between the two. Most taxpayers are getting a break. Their refunds may not show it.”
Usually, about 85 percent of households file their returns between late January and mid-April. Some taxpayers request an extension until Oct. 15. Possibly due to muddled messages, about 2 percent fewer returns had been filed through late March than in years past, according to a report in Atlantic magazine dated March 29. The magazine speculated that the “laggards” may be procrastinating in hopes the IRS will cast more light on the subject.
Brown, the part-time tax preparer and chief financial officer at Mission Waco/Mission World, said that may not prove an effective strategy.
“Some are wanting clear-cut answers, and there are no clear-cut answers,” he said. “Contact the IRS about a particular point, and you get a 200-page response. Ask for clarification or particulars, they say, ‘Let me think about that,’ or, ‘Well, it could be this.’ You can’t hold them accountable.”
He said tax code changes that created non-reimbursed expenses are wreaking havoc with some returns. Employees no longer can deduct expenses related to meals, entertainment, office supplies, books or mileage.
“Those counting on that deduction before now have to shoulder their own expenses, and those could be substantial,” said Brown.
Keshia Bridges Miller, co-owner of Prosperity Tax Service, said now more than ever it is vital to keep clients informed of tweaks in tax law.
“Our service is relationship-based,” she said. “After tax season last year, we began feeding information to our clients, some of it on Facebook, keeping them abreast of what’s happening, what’s going on, letting them know they may be getting a little more money back throughout the year.”
She added, “Many took our advice to check on exemptions and withholdings, to keep their check stubs handy so there would be no big surprises. Some clients were ready, some not in our communication circle were not. A good portion of our clients have been with us since the beginning, 13 to 14 years now, and we try to look out for their best interest. They are Facebook friends, Instagram friends, and we expect to hear from them and enjoy it.”
The New York Times reports that experts have mixed views on whether the tax cuts are delivering on what supporters promised.
The Tax Policy Center estimates that 65 percent of people paid less under the law and that just 6 percent paid more. The rest saw little changes in their taxes, according to the Times. The Joint Committee on Taxation — Congress’ nonpartisan team of analysts — found that every income group would see a tax cut on average. The Times also notes that the left-leaning Institute on Taxation and Economic Policy determined in a December 2017 analysis that every income group in every state would pay less in 2019.
But that same New York Times piece cites surveys showing that most people did not equate higher take-home pay with the tax cut.
That realization may arrive with tax day, H&R Block analyst Nathan Rigney told the Times, but “it’s little consolation to discover that you received a couple thousand dollars during the year but you already spent it.”
Tax preparers say the public must learn from the knot they may feel in their collective gut this year. Tend to those withholding issues, or tax time 2020 could be even more unsettling. The tax reforms and changes that took effect in March last year will run their course throughout all 2019.
Taxpayers who did not meet Monday’s deadline may pursue extensions providing temporary relief and avoiding penalties and interest.
PARIS — A massive fire swept across the top of Paris’ soaring Notre Dame Cathedral as it was undergoing renovations Monday, collapsing its spire and threatening one of the world’s greatest architectural treasures as tourists and Parisians looked on aghast from the streets below.
The French president pledged to rebuild a cathedral that he called “a part of us,” and appealed for national and international help to do so. The 12th-century church is home to relics, stained glass and other incalculable works of art and is a leading global tourist attraction, immortalized by Victor Hugo’s 1831 novel “The Hunchback of Notre Dame.”
The Paris prosecutor’s office said it was treating the fire as an accident, ruling out arson and possible terror-related motives, at least for now. French media quoted the Paris fire brigade as saying the fire was “potentially linked” to a 6 million-euro ($6.8 million) renovation project on the church’s spire and its 500 tons of wood and 250 tons of lead.
Despite the dramatic image of the flaming cathedral, no one was killed. One firefighter was injured, among some 400 who struggled against the flames for hours before finally extinguishing them. Firefighters continued working through the night to cool the building and secure the monument, as residual sparks sprinkled down from the gaping hole where the spire used to be.
The blaze started at 6:50 p.m. after it had closed to the public, and spread to one of the cathedral’s landmark rectangular towers.
Nearby buildings were evacuated as fears mounted that the structure could collapse.
As the spire fell, the sky lit up orange and flames shot out of the roof behind the nave of the cathedral, among the most visited landmarks in the world. Hundreds of people lined up bridges around the island that houses the church, watching in shock as acrid smoke rose in plumes.
Paris fire chief Jean-Claude Gallet said the church’s structure had been saved after firefighters managed to stop the fire spreading to the northern belfry. Gallet said “two-thirds of the roofing has been ravaged.”
The fire came less than a week before Easter amid Holy Week commemorations. As the cathedral burned, Parisians gathered spontaneously to pray and sing hymns outside the church of Saint-Julien-Les-Pauvres across the river from Notre Dame while the flames lit the sky behind them. Paris Archbishop Michel Aupetit invited priests across France to ring church bells in a call for prayers.
Nearing midnight, signs pointed to the fire nearing an end as lights could be seen through the windows moving around the front of the cathedral, apparently investigators inspecting the scene.
The city’s mayor, Anne Hidalgo, said a significant collection of art work and holy objects inside the church had been recovered.
Experts say firefighters were left with devastatingly few options when faced with a structure that’s more than 850 years old, built with heavy timber construction and soaring open spaces, and lacking sophisticated fire-protection systems.
French President Emmanuel Macron treated the fire as a national emergency, rushing to the scene and canceling a previously scheduled televised address meant to address France’s yellow vest crisis.
“The worse has been avoided, although the battle is not yet totally won,” the president said, adding that he would launch a national funding campaign on Tuesday and call on the world’s “greatest talents” to help rebuild the monument.
“Notre Dame of Paris is our history, our literature, our imagination. The place where we survived epidemics, wars, liberation. It has been the epicenter of our lives,” Macron said from the scene.
Built in the 12th and 13th centuries, Notre Dame is the most famous of the Gothic cathedrals of the Middle Ages . Situated on the Ile de la Cite, an island in the Seine river, its architecture is famous for, among other things, its many gargoyles and its iconic flying buttresses. Some 13 million people visit it every year.
Its priceless treasures also include a Catholic relic, the crown of thorns, which is only occasionally displayed, including on Fridays during Lent.
“It’s not one relic, not one piece of glass — it’s the totality,” said Barbara Drake Boehm, senior curator at the Metropolitan Museum of Art’s medieval Cloisters branch in New York, her voice shaking as she tried to put into words what the cathedral meant. “It’s the very soul of Paris, but it’s not just for French people. For all humanity, it’s one of the great monuments to the best of civilization.”
A street shooting in broad daylight Monday in North Waco left one man dead, Waco police said.
Neighbors in the 3100 block of Colonial Avenue notified police of multiple gunshots shortly after 4:30 p.m., Officer Garen Bynum said. While en route, they were informed that a young man between the ages of 19 and his early 20s had been dropped off at Ascension Providence with a gunshot wound.
He was pronounced dead about an hour after the shooting, Bynum said.
A second injured person was discovered shortly after the initial call, near Freebirds World Burrito on New Road and was taken to Baylor Scott & White Hillcrest Medical Center, Waco police Cmdr. Scott Mosley said.
The second man’s role in the incident was unclear, police said.
Bynum said it appears that the shooting involved two parties who fled in cars. Police canvassed the neighborhood, asking residents for any additional information about the shooting.
Police kept a heavy presence in the neighborhood Monday afternoon, collecting bullet casings and what appeared to be a handgun from the scene. More than 20 evidence markers were placed in the streets and yards.
A neighbor who asked to remain anonymous said reports of shootings have been reported to police in the past several months. It was unknown if other reports of violence were connected to the ongoing investigation.
No arrests were made by Monday evening.
Monday’s shooting marked the third fatal shooting in Waco this year.
On New Year’s Day, police investigated the shooting death of Marcus Carprew, 39, of Waco, who was found shot to death outside the House of Blues in the 200 block of South Loop Drive. Police have not made any arrests in Carprew’s death or given any additional information in the homicide investigation.
Sherrell Carter, 26, of Waco, was found shot to death inside a home at 5630 Wilshire Drive after she was involved in a violent encounter with Quest Aljabaughn Jones, 28, in early February. Jones was later arrested and charged with murder for Carter’s death.
Jones remains in custody at McLennan County Jail with a bond listed at $1 million.
The Texas Senate broke a logjam Monday that had paralyzed the upper chamber’s priority legislation for weeks, blunting a controversial provision in its property tax reform package and then advancing the bill without having to deploy a procedural “nuclear option.”
Though a vote on Senate Bill 2 had been expected last week, an apparent lack of support had stalled the vote in the upper chamber, where the backing of 19 senators is generally required to bring a bill up for debate. After Lt. Gov. Dan Patrick threatened to blow past decades of tradition and take a “nuclear option”— bringing the measure to a vote with only a simple majority — state Sen. Kel Seliger, a vocal dissenter, relented, allowing the bill onto the floor for debate but insisting he ultimately would not support its passage.
Seliger’s announcement came alongside a reworked bill which, following a weekend of negotiations, came to the floor Monday with a handful of technical changes and one notable concession.
In a lengthy speech explaining his decision, Seliger criticized Patrick for even floating the “nuclear option” — and suggested his vote letting SB 2 advance was at least partly driven by a desire to prevent the Senate from taking a procedural move that “discredits this body.”
“We have a way to do things that I think is important. It underscores that we must be willing to compromise,” Seliger said. He added: “This bill’s going to pass. Right now, nobody can get in the way.”
A top imperative for state leaders, SB 2 initially sought to force cities, counties and other taxing units, like community colleges, to receive voter approval before raising 2.5% more property tax revenue than the previous year. A substitute for the bill, unveiled on the Senate floor, raised the flashpoint 2.5% election trigger to 3.5% for all taxing units except school districts. They remain at 2.5%.
Democrats, municipal leaders and Seliger, a former mayor, have called the 2.5% figure punitively low, and said it would cripple local governments’ ability to provide public safety services. A one-percentage point increase is unlikely to appease them; the Senate and House deadlocked at higher thresholds of 4% and 6% in 2017.
Democratic senators proposed Monday dozens of amendments to exempt hospital districts, community colleges, and certain municipal services from parts of the property tax legislation. Most of the proposals failed on largely party lines.
One successful amendment, from Sen. Peter Flores, a freshman Republican from Pleasanton, allows for money counties spend on indigent defense to be partly excluded from the revenue growth calculation.
In the end, after around three hours of debate, 18 lawmakers voted for SB 2’s passage. Legislative rules require that the measure be voted on a final time by the upper chamber, before being sent to the House for further debate.
The House, meanwhile, has postponed a debate on its own property tax reform legislation — House Bill 2 — until April 24. Unlike the Senate’s version, the House has exempted hospital districts, community colleges, emergency service districts and school districts from abiding by a 2.5% election trigger.
Currently, taxing units can levy 8% more property tax revenue before voters can petition for an election to roll back the increase. SB 2 and HB 2 make those elections automatic, and propose a battery of widely-supported reforms designed to increase transparency and utility for taxpayers.
SB 2’s progress Monday came after more than two months of stalemate in the upper chamber, and after the Senate stalled again on Thursday, when the measure was expected to hit the floor for the first time. That evening, after hours of closed-door negotiations, Patrick informed several Democratic senators that if no deal had been reached by Monday, he would take the “nuclear option” — blowing past a tradition that requires three-fifths of senators to vote to bring a bill to the floor — to pass the measure.
That threat seems to have greased the skids for negotiations. As recently as Sunday night, Patrick signaled a willingness to take the “nuclear” step.
“If that is the only choice left to me to pass meaningful and lasting property tax reform and relief on Monday, I will use it,” he wrote in an email to supporters.