Nonwithheld Individual Income Tax Receipts: Boosted by the End of Payment Delays, But Overall Still Down from Last Year’s Amounts
Posted on July 31, 2020 Summary Nonwithheld tax receipts, which include final payments with tax returns and quarterly estimated payments, boomed in July, but only because of payments that were allowed to be delayed from April and June. Looking more appropriately over the April-July period, which was largely unaffected by the payment delays, nonwithheld payments […]
Total Federal Revenues are Rebounding with the End of Payment Delays
Posted on July 26, 2020 Here’s a one-paragraph post for a change. The IRS is still counting the money from checks that taxpayers remitted with their 2019 tax returns, which were due by July 15. This upcoming week should see the end of that counting. By my calculation, total revenues from all sources for the […]
The Expiration of Allowed Payment Delays Continues to Boost Tax Collections Sharply This Month
Posted on July 22, 2020 The IRS is still counting the money from checks that individuals mailed by the July 15 tax filing deadline, but we’re seeing the reversal of the effects of IRS administrative actions that allowed individuals to defer payments until July 15 that were originally due from April to June. Those deferrals […]
Reported Tax Withholding Surged in the Week Leading up to July 15, But It May Not Be Real
Posted on July 20, 2020 Summary Withholding tax receipts in the week up to July 15 were so large that I think it is very possible that there was a misallocation of tax receipts in the daily revenue data and some of the strength in withholding may really have been in other revenue sources. A […]
Ka-ching: Federal Revenue Coffers are Getting Replenished as Some Major Payment Delays Expire
Posted on July 18, 2020 Federal revenues were very low from April to June, mainly because the Treasury Department allowed individuals and corporations to delay until July 15 remitting amounts for income taxes otherwise due during those three months. Now that July 15 has passed, daily tax receipts are showing a major rebound, with more […]
Tax Withholding in the First Half of July: Continued Improvement
Posted on July 15, 2020 Our measure of federal tax withholding growth shows continued improvement in the first half of July, consistent with further recovery in economywide wages and salaries compared to the bottom of the cycle in late April/early May. We estimate that daily tax withholding was down by about 4 percent in the […]
Jumbo-Sized Tax Payments are Due by July 15
Posted on July 8, 2020 Summary Several tax payment delays end in just a week, on July 15, so that should be a very big day for federal tax payments. Much of that will get recorded by the IRS over the second half of the month. The biggest amounts will result from many taxpayers filing […]
June Employment Report: Improvement in Wages in Line with Daily Tax Withholding
Posted on July 3, 2020 Summary Yesterday’s employment report for June from BLS showed a clear improvement in economywide wages and salaries, which was in line with what we were seeing through the course of June in daily tax withholding. Withholding and wages have a long way to go to return to pre-pandemic levels. Withholding […]
Withholding Tax Collections in June: Clear Improvement
Posted June 27, 2020 Summary Withholding tax collections picked up in June. Withholding was down by about 5 percent for the month compared to the amount of withholding in June 2019; that is a clear improvement from the decline in May of about 7 percent compared to year-ago levels. Those measures remove the estimated effects […]
Excise Tax Collections: Down Substantially But Recovering Somewhat
Posted on June 24, 2020 Summary Excise tax collections have been down substantially during the pandemic, by 50 percent compared to year-ago levels for the most recent semimonthly payment in mid-June. The decline has occurred for three main reasons: a legislated suspension of aviation-related taxes through the end of the year; an administratively-allowed delay of […]
Unemployment Benefits: Big Tax Effects, Too
Posted on June 17, 2020 Summary The CARES Act has boosted unemployment benefits substantially, for many individuals cushioning the economic hardship imposed by the pandemic. Those unemployment benefits have substantial tax effects. Information from New York State suggests that most taxpayers are having income tax amounts withheld from their unemployment benefits, thereby potentially avoiding a […]
First Half of June Withholding: Slight Improvement
Posted on June 12, 2020 Summary Tax withholding continued to move up slightly in the first half of June, as the recent sharp declines in withholding have moderated somewhat since late April. The improvement in withholding suggests that economywide wages and salaries have moved up from their levels at the worst of the downturn, although […]
Revisions to Estimated Effects on Withholding of Recent Law Changes
Posted on June 8, 2020 Summary We now estimate that recent law changes have reduced withholding growth by about 4 percentage points, compared to the 8 percentage points we had previously been estimating. That change makes larger our estimates of the recent decline in withholding, adjusted to remove the effects of recent law changes. In […]
Hello Businesses: Anyone Out There Deferring Payroll Tax Remittances as Allowed by the CARES Act?
Posted on June 4, 2020 Summary It appears that a small share of firms are taking advantage of the provision of the CARES Act that allows them to defer, for an extended period, remitting to the Treasury their share of Social Security payroll taxes. The Congressional revenue estimates produced when the legislation was under consideration […]
Tax Withholding in May: Wages and Salaries Moving Roughly Sideways
Posted May 29, 2020 Summary Tax withholding data for May suggest that economywide wages and salaries are moving roughly sideways compared to the amounts in April. That conclusion stems from our interpretation of both the raw withholding data and the data adjusted to remove the estimated effects of certain tax law changes. We are seeing […]
Forecasting the 2019 and 2020 Social Security Average Wage Index; Or, Why 2020 May Be an Unfortunate Year to Turn 60
Posted on May 26, 2020 Summary Now that we have estimates of 2019 wage growth from the BLS Quarterly Census of Employment and Wages, we can estimate that the 2019 average wage index used for Social Security purposes will grow in the vicinity of 3.5 percent for the year. The Social Security Administration should release […]
We Expect a Minimal Revision This Summer to Data on 2019 Wage Growth in the National Income and Product Accounts
Posted on May 22, 2020 Summary New BLS data on wages and salaries for 2019, which are the main data source used by BEA to update the National Income and Product Account estimates of wages and salaries, strongly suggest there will be only minimal revisions to the NIPA data for 2019 in the annual July […]
First Half of May Withholding: Overall Economy Now Moving Sideways?
Posted May 18, 2020 Summary We estimate that tax withholding fell by 4.7 percent, measured on a year-over-year basis, in the first half of May, compared with a 5.4 percent decline in the second half of April. That suggests that overall wage income has roughly stabilized. Withholding growth historically has tracked economywide wage growth. The […]
April Tax Receipts: Down Less Than We Expected, But the Reason Doesn’t Reduce the Federal Deficit
Posted on May 14, 2020 The Treasury Department released the Monthly Treasury Statement for April on Tuesday, showing that revenues for the month fell by 55 percent compared to the amount collected in April of last year. That’s quite a drop, but it’s a smaller decline than we expected last week (see post) of 70 […]
April Employment Report: Wage Growth Way Down, Especially for Lower-Wage Workers
Posted on May 10, 2020 Summary Friday’s BLS employment report for April not surprisingly showed a sharp drop in economywide wages, a steeper drop than indicated by the tax withholding data alone. The two measures tend to move together, though far from in lockstep. BLS measures of wage growth for different groups of workers indicate […]
Federal Excise Tax Receipts: Way Down in April
Posted on May 8, 2020 Excise tax receipts were down about 58 percent in the latest semimonthly payment period at the end of April (compared to the same period a year ago). Declines were due to legislation suspending taxes (aviation taxes, which were going to be very low anyway); administrative relief allowing delays in paying […]
April Tax Receipts: Down, Down, Down
Posted on May 4, 2020 We estimate that total federal tax receipts in April were down by 70 percent to 85 percent compared to amounts in April 2019, a drop so large that it would shift receipts for the current fiscal year (which started in October) from a gain of 6 percent through March to […]
Withholding Growth Drops Very Sharply in April
Posted April 28, 2020 We estimate that tax withholding on a constant law basis fell by 5.4 percent in April compared to amounts from a year ago, a very large change from the 6 percent increase registered just two months ago in February. That almost 11.5 percentage point swing is consistent with about a 10.5 […]
Recovery Rebates: About Half of the Total Expected Amount Has Gone Out So Far
Posted April 24, 2020 I estimate that about $149 billion in rebates have been disbursed so far, just slightly over half of the total $292 billion expected by Congressional revenue estimators to eventually be disbursed. Almost all of the amount that has gone out has been directly deposited. I estimate that only about $3 billion […]
Tax Withholding Remittances are Dropping Precipitously
Posted on April 20 2020 Withholding tax remittances have dropped precipitously, consistent with the severe contraction of the economy resulting from the actions to contain COVID-19. We obtain measurements of withholding growth each day this week, and the first one today shows that withholding has taken another step down: withholding is down by almost 5 […]