Did the Requirement to Pay Estimated Taxes by April 15 Convince Many Taxpayers to File Early–And Pay?
Posted on May 3, 2021 This year is the first year I’m aware of that individuals’ first quarterly estimated payments of income taxes were due on a different day than income tax returns were due. The first estimated payment this year was due by April 15, while the deadline to file an income tax return […]
Tax Withholding Growth Remains Strong in April, but With a Slight Drop-off From March
Posted on April 29, 2021 Tax withholding growth in April has remained strong. We measure that relative to withholding in April 2019–so two years ago–withholding was 11.8 percent higher (see chart below). That measure removes the estimated effects of tax law changes that affect withholding but not wages and salaries (estimated to be small on […]
Excise Tax Revenues Appear to Be Recovering
Posted on April 22, 2021 It is looking like payments of excise taxes are recovering well. The past two semi-monthly payments have improved substantially compared to the amounts from the comparable periods two years ago. We are starting to compare current amounts to two years ago because the most recent payments are way up when […]
The Mid-April Corporate Income Tax Payment Was Surprisingly Large
Posted on April 18, 2021 Corporations paid a surprisingly (to me) large amount of income taxes in mid-April. For the majority of firms whose accounting is done on a calendar year basis, mid-April (Thursday of last week this year) is the due date both for quarterly estimated payments for the first quarter of the current […]
Strong Employment Report for March: Total Wages Jump Up
Posted on April 5, 2021 Employment and wage data for March, released by the Bureau of Labor Statistics (BLS) on Friday of last week, showed a pop up in both employment and wages. Private-sector wages as measured by the BLS establishment survey jumped to 2.1 percent above March 2020 amounts, after being down by 0.7 […]
Tax Withholding Growth Remained Very Strong in March
Posted on March 31, 2021 Summary Tax withholding growth in March was strong on both a year-over-year basis and, more relevantly, on a year-over-two-year basis. We now look at two-year growth in withholding because the standard year-over-year measures are becoming distorted by the base period being the severely depressed amounts from a year ago. Withholding […]
Normally Federal Revenues Get Hit Hard the Year After a Recession Starts, But This Time Feels Very Different
Posted on March 25, 2021 I learned as a federal revenue estimator never to underestimate the effects of a recession on the following year’s receipts, when individuals’ final payments in April would drop sharply and refunds through the tax filing season would increase significantly. I learned those lessons in April of 2002 and 2009, well […]
The Average Indexed Wage for 2020: What Do We Know About the Likely Movement?
Posted on March 21, 2021 Summary There is still a lot of uncertainty, but my best guess at this point is that the average wage index (AWI) for Social Security purposes will be roughly flat in 2020, neither falling nor rising, which would be a better performance than projections by Stephen Goss of SSA and, […]
No Obvious Revision In Store to 2020 NIPA Wages and Salaries
Posted on March 15, 2021 We learned more from the Quarterly Census of Employment and Wages (QCEW) for the third quarter of 2020 that was released on Tuesday of last week by the Bureau of Labor Statistics (BLS). The QCEW data are administrative data on employment and wages collected from nearly all employers by the […]
Growth in Economywide Wages and Salaries: Different Signals from BEA, BLS, and Tax Collections
Posted on March 10, 2021 Despite some recent modest revisions to data from the Bureau of Economic Analysis (BEA), we are still getting different signals on the pace of recovery in economywide wages and salaries from BEA, the Bureau of Labor Statistics (BLS), and the Treasury Department’s tax withholding data. On Friday of last week, […]
Tax Withholding Growth Remains Strong in February, Though Less So Than in January
Posted on February 27, 2021 By our measure, income and payroll taxes withheld from workers’ paychecks and remitted by employers to the Treasury Department rose in February by 4.7 percent above amounts remitted in February 2020 (see chart below). That measure is adjusted to remove the estimated effects of tax law changes, but is a […]
New Economywide Wage and Employment Data for 2020Q3: Possible Downward NIPA Wage Revision and an Anticipated Full-Year Decline in the Social Security National Average Wage Index
February 24, 2021 Summary Partial data for 2020Q3 from the Quarterly Census of Employment and Wages (QCEW), released today by the Bureau of Labor Statistics, indicate a possible upcoming downward revision, perhaps on the order of 1.5 percent, to wages and salaries in the National Income and Product Accounts (NIPAs) for the quarter. The NIPA […]
Introducing Withholding Comparisons to Two Years Ago
Posted on February 21, 2021 We’re coming up on a year now since the pandemic caused shutdowns and the severe economic contraction. Here we address the purely measurement implications of that one-year mark on how we assess the current income and payroll tax withholding data. The way we normally measure withholding growth is on a […]
Corporate Income Tax Payments Are Rebounding; Will Big Refunds Reduce the Net Amount Received by the Federal Government This Fiscal Year?
Posted on February 18, 2021 Gross corporate income tax payments–that is, the payments not reduced by refunds received–have rebounded over the past three months: the mid-month payment of income taxes by corporations has increased compared to year-ago amounts. January and February are small corporate payment months–mainly reflecting quarterly payments by the minority of firms not […]
Withholding Growth in the First Half of February: Still Strong But Less So Than in January
Posted on February 14, 2021 Below are some bullet points on recent developments in withholding tax remittances along with two charts: Daily tax withholding growth in the first half of February (measured relative to year-ago amounts and adjusted to remove the estimated effects of tax law changes) has come down some since the elevated level […]
Growth in Economywide Wages and Salaries: Different Signals from BEA and BLS
Posted on February 7, 2021 We won’t let Super Bowl Sunday stop us from posting, so let’s get right to it. Having a gauge on how economywide wages and salaries are doing is important, especially during the recovery from a recession, and we are currently getting somewhat different signals from the Commerce Department’s Bureau of […]
Individual Nonwithheld Payments Grew Sharply in January: The Effects of Accelerating Income into 2020 in Anticipation of Tax Increases?
Posted on February 1, 2021 According to the Treasury Department’s daily tabulations, individual nonwithheld receipts in January–consisting largely of the last quarterly estimated income tax payment for 2020–grew by about 17 percent compared to the amount in January 2020. That is the highest January growth since 2013 (see chart below). A significant factor behind the […]
Tax Withholding in January: Up Sharply but January Movements Are Often Unusual and Temporary
Posted on January 28, 2020 Summary Tax withholding remittances jumped up in January by our measure to about 6.4 percent above year-ago amounts, which would be on par with where withholding would be without the recession. We don’t take the withholding jump up as an indicator of how the economy is doing. Daily withholding amounts […]
Individual Nonwithheld Payments–Mainly Quarterly Estimated Payments–Are Strong So Far in January
Posted on January 20, 2021 If you make quarterly estimated payments, I hope you made your last one for tax year 2020 last week. The last one was due to the IRS by January 15, and the early data suggest that overall estimated payments will probably be up compared to amounts paid last year, but […]
Total Private-Sector Wages Improved Just Slightly in December, According to the Monthly Establishment Survey
Posted on January 12, 2021 According to the monthly establishment survey of the Bureau of Labor Statistics (BLS), with the data for December released on Friday of last week, the economy lost jobs in December but total wage income still improved– just slightly. Total wage income rose because average hourly earnings increased for those working […]
Withholding Jumps Starting in Late December: Bonuses, Wage Shifting, or Deferred Payroll Tax Payments?
Posted on January 7, 2021 The daily amount of income and payroll tax withholding from paychecks has been slowly but steadily recovering since April, and has taken a distinct jump upward since mid-December. We expect the jump to be temporary. The year-end bonus season generally makes withholding amounts move around temporarily. Acceleration of some wage […]
New Year, New Adjustments to Reported Tax Withholding to Account for Legislative Changes
Posted on December 30, 2020 Happy New Year, everyone. In short, the end of the calendar year means that we’ll be using new estimates going forward of the effects on withholding of legislative changes. Primarily because of the expiration of two payroll tax deferral provisions this week, our estimated legislative effects will be changing starting […]
Withholding Growth Has Improved in December
Posted on December 24, 2020 By our measure, income and payroll taxes withheld from workers’ paychecks, which tend to move with economywide wages and salaries, have improved in December. We estimate that tax withholding was 1.2 percent above the amounts from December of a year ago, measured to remove the estimated effects of federal tax […]
A Bounce Back in Corporate Receipts in December
Posted on December 16, 2020 Here’s a quick note on a recent development in federal corporate income tax payments. The pandemic and associated economic effects caused a significant reduction in corporate income tax payments through the big September quarterly payment this year, but those receipts have rebounded in December. A major quarterly estimated payment due […]
Total Private-Sector Wages and Salaries Improved Just Slightly in November According to the Monthly Establishment Survey
Posted on December 7, 2020 Here’s just a quick paragraph and a chart about anemic growth in aggregate wages and salaries in the national economy as reported by the Bureau of Labor Statistics (BLS) in its monthly establishment survey for November. Total wages and salaries of private-sector workers improved slightly, from being down by 0.9 […]