The 2019 Tax Season by the Numbers

The 2017 Tax Cuts and Jobs Act (“TCJA”) offers an excellent opportunity to examine the impact on U.S. tax filings and compare the related tax revenues generated and refunds paid for the tax years 2018 and 2017. Furthermore, it can offer a continuing analysis of the legislation’s effect on the U.S. economy into 2019 and beyond.

Under the TCJA, there were numerous changes to the individual income tax, including changing the income level of individual tax brackets, lowering tax rates, and increasing the standard deductions and family tax credits—while itemized deductions are reduced and the personal exemptions eliminated. Most individual income taxes are reduced until 2025. While the number of income tax brackets remains at seven, the income ranges in several brackets have been changed, and each new bracket has lower rates.

In April 2019, the U.S. Treasury released comparative year-over-year information citing various cumulative individual federal income tax filing statistics for the 2018 tax year (through March 31, 2019) and the 2017 tax year (through March 31, 2018). A summary of these key statistics follows.

Regarding the number of tax filings received, for the 2018 tax year there were nearly 93 million compared to 94 million for the 2017 tax year, a decline of 1.4%. The number of 2018 tax filings processed decreased by 1.4% compared to 2017, 90.3 million compared to 91.6 million. The number of total e-filings received for both tax years was flat at approximately 87.3 million; however, the number of e-filings submitted by tax professionals decreased by 2% for the 2018 tax year compared to 2017 (47.4 million compared to 48.4 million). Self-prepared e-filings increased by 2.5%, with nearly 40 million e-filings submitted for the 2018 tax year compared to 39 million for 2017.

The number of refunds decreased by 2.2% for 2018, with 71.8 million processed for 2018 compared to 73.4 million for 2017. The total dollar amount of federal tax refunds decreased 3% for 2018, with $206 billion processed compared to $212.3 billion for 2017. The average refund, however, decreased modestly to $2,873 for 2018 compared to $2,893 for 2017.

The number of Direct Deposit refunds was also less for the 2018 tax year compared to 2017, with $64.3 billion for 2018 and $63.8 billion for 2017. The total dollar amount of federal tax Direct Deposit refunds also decreased for 2018, with slightly more than $193.8 billion processed compared to $192.4 billion for 2017. The average of Direct Deposit refunds was lower for the 2018 tax year at $2,995 compared to $3,036 for 2017.

We will provide additional analysis of 2018 U.S. tax year filings compared to 2017, as well as the legislation’s impact on the U.S. economy into 2019.

Tax Filing Season 2018/2019 Comparative

Source: U.S. Treasury Department