Tax Day by the numbers: Time is ticking to meet tax-filing deadline

Time is ticking to meet Monday's tax-filing deadline.

If you’re still scrambling to finish filing your returns, you’re not alone. As of last Friday, the Internal Revenue Service, said in a news release that about 50 million people had yet to file.

As of April 5, the IRS had received more than 103 million tax returns, and issued more than 77 million refunds totaling $220.762 billion -- a nearly $6 billion decrease from that time last year. The average refund was $2,833, down 1.1 percent, with more than a million fewer taxpayers receiving them compared to that time last year.

Taxpayers in Maine and Massachusetts have until April 17 to file because of local holidays, and there are some other ways taxpayers can get extra time without asking, including if they were affected by a natural disaster, are serving in a combat zone or are living abroad.

The IRS estimates that more than 14.6 million taxpayers will file for and receive an automatic extension. Taxpayers can request an extension to file for Oct. 15, 2019, through Free File on IRS.gov. And if they were affected by certain federally declared disasters, such as the tornadoes and storms in Alabama or the California wildfires, there are various extensions to file and pay by. If their address of record is located within a disaster area, the IRS said in a news release there’s no need to contact the agency to receive the relief.

This tax season provided new challenges for both taxpayers and the IRS to navigate, with the longest-running government shutdown in U.S. history combined with the implementation of the new federal tax law.

Visits to the IRS.gov website were up by about 10 percent as of April 5 compared to that time last year, with over 376 million visits, according to data released by the IRS.

According to the National Taxpayer Advocate’s 2018 Annual Report to Congress, the shutdown had devastating effects. The Taxpayer Advocate Service is an independent organization within the IRS that advocates for taxpayers’ rights.

“The five weeks could not have come at a worse time for the IRS — facing its first filing season implementing a massive new tax law, with a completely restructured tax form,” Nina Olson, the National Taxpayer Advocate, wrote in the report’s preface.

In the first week of the 2018 filing season, the IRS answered 86 percent of calls routed to an Accounts Management telephone assistor with an average wait time of about four minutes, according to a news release. During the first week of this year’s filing season, the number of calls answered dropped to 48 percent with an average wait time of 17 minutes. On some other IRS telephone lines, the wait time jumped to an average of 81 minutes to receive assistance.

On top of that, the new tax law also required the IRS to update forms and notices.

“Because of the revamp of the tax forms, the electronic filing requirements were not issued to private tax software vendors and electronic return originators until September 2018, much later than in previous years,” according to the report.

In a recent Wall Street Journal/NBC News poll that asked how much in taxes respondents anticipated paying under the new law, 28 percent of people surveyed said they expected to pay more, 17 percent said they are paying less and the remainder said they were paying about the same or that they didn’t know enough to say one way or another.

The tax preparation company H&R Block analyzed clients’ data through March 31, and found that tax refunds are up 1.4 percent under the new law, while overall tax liability is down 24.9 percent, according to an April 11 news release. Tax liability was down nearly $1,200 on average and refunds were up $43, leaving an average of $1,156 that went into paychecks during the year, according to H&R Block’s analysis.

The taxpayers who experienced the biggest discrepancy between their paychecks and refunds: those who itemized in 2017 and 2018, according to H&R Block. Meanwhile the group with the largest refund increase -- about 6 percent on average -- were those who took the standard deduction in 2017 and 2018.

“It’s reasonable to assume that a tax cut would mean your refund will increase, but that’s not necessarily the case,” Kathy Pickering, executive director of The Tax Institute and vice president of regulatory affairs at H&R Block, said in a news release. “The IRS updated how employers calculate how much tax to withhold from paychecks, which means you could have been getting all your tax cut – and then some – in your paychecks.”

“Either surprise – getting a larger or smaller refund than expected – can be a problem when you’ve been planning for and expecting something different,” Pickering said. “If you’re not happy with your refund, the important thing is to update your withholding so the same thing doesn’t happen to you again next year.”