Advertisement
YOU ARE HERE: LAT HomeCollections

Tax Refunds Average $711, Up About 20%

February 11, 1988|Associated Press

WASHINGTON — Average federal tax refunds are running almost 20% larger than they were a year ago, the Internal Revenue Service said today.

The IRS also announced that the number of couples and individuals who are filing early returns is down 17.5% from last year.

The returns, due April 15, are the first filed since most provisions of the 1986 tax overhaul took effect. That law, the biggest rewriting of the tax code ever, significantly cut tax rates, raised personal exemptions and reduced or eliminated several individual deductions.

The average refund for the first five weeks of 1988 was $656, up 19.5% from $548 at this time in 1987. The average for returns processed last week was up $100--to $711.

Effect of New Law

Robert LeBaube, director of the IRS taxpayer-service division, said the larger refunds indicate that most taxpayers took seriously the requirement under the new law to file a revised W-4 form in order to bring taxes withheld closer to actual tax liabilities.

The larger refunds mean people are giving the government interest-free use of more of their money, but LeBaube noted that many people deliberately adjust their withholding in order to get a "windfall" at tax-filing time.

In the first five weeks of the filing season, the IRS received 9.14 million returns, compared with 11.08 million for the same period last year. That drop is not totally surprising, since the IRS has noted a steady decline for several years in the number who file early.

Advertisement
Los Angeles Times Articles
|
|
|