Every filing season, a lot of taxpayers discover that, at least from their point of view, they are paying too much in taxes.
That’s still true, even though we’ve now had four full years of the Tax Cuts and Jobs Act (TCJA) changes.
This major tax reform bill was supposed to simplify filings, and it did for millions by expanding the standard deduction amounts and shifting folks from itemizing.
It also, according to the Republican lawmakers who crafted it, was supposed to cut our taxes. How well it did that depends on who’s parsing the provisions and numbers.
But despite the TCJA changes, it didn’t fundamentally alter people’s view of taxes. Even when we understand why we need them and how they benefit us, we tend not to like them.
Survey says, we don’t like paying taxes: So it’s no surprise that half of Americans who participated in a recent survey said they pay too much in taxes.
And even though it was the GOP that muscled through the 2017 tax reform bill, LendingTree’s survey found Republicans were more likely to say it didn’t do enough. Fifty-eight percent of respondents affiliated with the Grand Old Party said their tax bills were too large.
Independents also feel like they are over paying taxes. Fifty-one percent of folks who identified as not affiliated with one of the two major parties told Qualtrics, which LendingTree commissioned to conduct the online survey in mid-February, reported being over-taxed.
Democrats were more sanguine about their taxes. Only 42 percent of Dems surveyed said they were paying the U.S. Treasury too much of their earnings.
Not to give too much attention to the complainers, but I am choosing the 58 percent of Republicans who are not pleased with their tax liabilities as this weekend’s By the Numbers figure.
Cutting your tax bill: Of course, tax laws still allow for ways we can trim our tax bills.
You can get some ideas in my post on above-the-line deductions available to all taxpayers, whether they itemize or take the standard deduction, as well as in my overview of often overlooked tax breaks.
LendingTree’s survey found that 55 percent of taxpayers plan to do at least one thing to reduce their tax bill. These reduction methods include:
- donating to charity (24%),
- contributing to pretax retirement accounts (16%), and
- deducting medical expenses (14%).
However, that percentage is dramatically down from the prior-year’s tax survey by the online lending marketplace. In 2021, 70 percent of filers said they would make tax-saving moves.
If you still haven’t filed, I urge you to look into all tax-cutting options that are still available, like the ol’ blog links above and below. They might help move you from the paying too much in taxes category, at least a bit.
You also might find these items of interest:
- Don’t make any of these 12 common tax filing mistakes
- 5 March tax moves you can make to cut your 2021 IRS bill
- Make sure you claim your charitable tax deductions, on Form 1040 or Schedule A
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