Tax-time surprise: Kennewick pro explains why some seeing lackluster refunds


    Tax-time surprise: Kennewick pro explains why some seeing lackluster refunds

    Local tax professionals say things are finally picking up after the month-long government shutdown .

    Taxes are getting prepared and tax-payers are dreaming up ways to use their refunds.

    But the pros say some people aren't getting the payout they're used to.

    They say it changes on a case-by-case basis, but for the most part, the folks counting on year-long tax deductions as some kind of piggy bank might need to rethink their savings plan.

    With 100 hours of training, and then some, Enrolled agent Barbara Culver with Tax Center Plus says she's ready to answer her client's questions about the changes.

    "This year is very different than last year because the taxes are lower and the credits are greater. The tax forms have changed 100 percent, none of them are the same," she nodded. "I'll be seeing a family with seven children tonight, so I guess we'll see how it effects them."

    Culver says so far her client's refunds are a little bit larger, but the season is young.

    While she says she's seen national stories featuring heartbroken taxpayers, nobody's left her office in tears yet.

    She thinks Washington State residents might be protected from some of that disappointment because they don't have state income-tax.

    "So you've got lower taxes paid for the different levels of your taxable income," she said.

    Culver says this means we're paying less with every pay-check.

    "A lot of them want to know why their refund is less; they've probably gotten the money during the year," she said,

    The tax pro is warning folks planning to itemize their return to reconsider because this year, itemized deductions are limited to $10-thousand.

    "Mortgage rates are much much lower than they have been traditionally," she explained. "So your mortgage interest in taxes, along with your charitable contributions and incidentals that are deductible won't add up to the $24 thousand [needed] for married-filing-jointly."

    Culver says it's hard to say how people are reacting because it's still early, but so far her clients haven't complained.

    "I had one client call me," she remembered, " 'Okay, we got all this money back, so what do we do instead of giving it to the government all year as an interest-free loan'?"

    She says a lot of people count on their yearly tax return to make ends meet.

    "It's the only way they save," she explained. "And then as you grow and figure things out you realize that you need to have another kind of savings plan."

    She paused, thinking, before adding:

    "But if you have no other way to save, I suppose that's as good as any."

    Culver tells clients wanting to pay less in taxes to invest in their future; she says retirement plans and a 401k earn interest while protecting your money, but tax refunds don't.

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