“There are going to be a lot of unhappy people over the next month,” said Edward Karl, vice president of taxation for the American Institute of CPAs. “Taxpayers want a large refund."
For two years, Trump's reliably useful idiots turned a blind eye to 2016 Russian election interference pretending nothing happened. Willful complicity which gave license to far greater fraud in the 2018 mid-term election - this time at their own expense. An election paid for with voters' own 2019 tax refunds under the phony auspice of a tax cut. Finance con artists are now out in full force informing us that large refunds are a bad thing, because you are lending the government interest-free money. However, the inconvenient truth remains that no one was informed that their higher paycheck was in lieu of their usual end of year refund. All of which gives rise to the far bigger deception that took place - the purposeful under-withholding of tax in order to conceal the fact that the entire middle class tax cut was a con job. Feed voters their own refunds to give the illusion of a tax cut. A level of deceit depraved even by Republican standards. Yet one more descent down the slippery slope of Banana Republican corruption. One corrupt deed leading to the next bigger one. A LOT of families will be hurt by this latest bait and switch scam far beyond Trump's alt-Christian base.
Now we know why retail stocks went parabolic last summer - because two years of tax refunds were pulled into 2018. Cramer was ecstatic. But then a funny thing happened, after the election, retail stocks gave up ALL of the gains. Wall Street of course in on the scam, since it was Treasury by Goldman Sachs that came up with it in the first place.
This fraud gamed the economy big time.
Consumer sentiment peaked last February after the tax cut went into effect. Now it's tanking even before people realize they were conned:
It's abundantly clear that Republicans can no longer win elections by honest means - they've used up far too many people along the way. Now, they are solely reliant on their patented "deaths of despair" campaign strategy and all manner of electoral malfeasance. From gerrymandering to voter suppression, de-regulated corruption, Russian election assistance, borrowed GDP, appeals to overt racism, Twitter-assisted brainwashing, incessant lying, Facebook phishing, email hacking, and of course Faux News. Now they've reached a new all time low by pulling forward the 2019 tax refund into 2018 in order to trick voters into believing that their annual refund was part of the tax cut, ahead of the November mid-term election. It's clear via the nine so far Mueller indictments (not including Russian agents), that there is no level to which they won't stoop to maintain their death grip on power. It's the *new* democracy circa 1800s - your vote doesn't count unless you are some old white demented geezer, evidencing the morality of a 12 year-old crack whore. From an historical perspective, they have chosen humiliation over humility. The way this all ends will be mind-bogglingly ugly.
This latest election-rigging scam was planned a year ago at the time the tax cut was implemented:
January 10th, 2018:
"The IRS is facing its first big challenge implementing the new tax law: deciding how much in taxes to withhold from millions of Americans’ paychecks. The agency is under pressure to take as little as possible so people will see big increases in their take-home pay ahead of this year’s midterm elections."
But that would come at a cost: smaller or even nonexistent refunds next year, though millions rely on them to plug holes in their family budgets."
How the IRS — which is supposed to be apolitical — decides to implement withholding could go a long way toward shaping public opinion on the controversial law."
Fast forward, and the end-result is now becoming clear:
"...the Republican Party implemented their signature tax bill in a manner that will lead many people who received tax cuts to believe that Donald Trump raised their taxes"
In order to bypass the "apolitical" IRS, the Treasury department was granted new authority over withholding decisions:
"Under the Tax Cuts and Jobs Act, Treasury [Steve Mnuchin] had new discretion for 2018 to adopt rules under which the total withholding allowance is determined"
Treasury’s simulation showed that any of the withholding allowance values it analyzed would decrease the proportion of overwithheld taxpayers and increase the proportion of underwithheld taxpayers compared to prior law"
It's very clear based on this GAO memo what happened: The old W-4 withholding worksheet is no longer valid, but there was not enough time to distribute a new one to employers prior to implementation. So, in order to maximize the paycheck impact, Treasury authorized a standardized withholding allowance of $4,150 on top of employees' existing exemptions. Which essentially doubled the amount of withholding allowances. Because the standard allowance is a fixed constant, this under-withholding issue disproportionately affects mid to lower income workers. The IRS is attempting to spin this as only an 8% average decrease overall, but averages are totally meaningless in this situation. Higher income workers will likely see larger refunds, whereas median income workers will see smaller or no refunds. The net effect for millions of people was to pull their normal tax refund forward in the year to give the illusion of a larger tax cut.
They knew this was going to be a disaster, so here was the consolation prize:
"The updated federal tax withholding tables, released in early 2018, largely reflected the lower tax rates and the increased standard deduction brought about by the new law. This generally meant taxpayers had less tax withheld in 2018 and saw more in their paychecks. However, the withholding tables couldn’t fully factor in other changes, such as the suspension of dependency exemptions and reduced itemized deductions. As a result, some taxpayers could have paid too little tax during the year, if they did not submit a properly-revised W-4 withholding form to their employer"
This realization is only starting to sink in:
They knew this was going to be a disaster, so here was the consolation prize:
"The updated federal tax withholding tables, released in early 2018, largely reflected the lower tax rates and the increased standard deduction brought about by the new law. This generally meant taxpayers had less tax withheld in 2018 and saw more in their paychecks. However, the withholding tables couldn’t fully factor in other changes, such as the suspension of dependency exemptions and reduced itemized deductions. As a result, some taxpayers could have paid too little tax during the year, if they did not submit a properly-revised W-4 withholding form to their employer"
This realization is only starting to sink in:
