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Your 2019 Tax Refund Might Be Higher, Lower or Later Than Usual



Some of the taxpayers hit hardest by the law changes could also be for an unwelcome surprise this filing season. Higher-income taxpayers in high-tax states like California, New York and New Jersey were particularly at risk for an unexpected tax liability, Morgan Stanley analysts estimate. This is because taxpayers are more likely to have large deductions for state and local taxes paid on their federal returns. Mr. Trump's tax law capped at deduction, known as S.A.L.T., at $ 10,000 per household per year.

Across the country, unexpectedly large refunds would be a welcome injection of cash into an economy facing a potential slowdown. Business spending tapered in late 201

8, and that slowdown most likely worsened as financial markets convulsed in December, weighing on corporate and consumer confidence. The government shutdown is also expected to sap economic growth in the first quarter, since workers and contractors were not paid and fixed amounts of government work went undone. Some workers will catch up on their spending once they receive back pay; Others, including contractors and business owners, will have suffered a permanent loss. Federal workers may not be in a rush to spend any money, given the White House and Congress have only given themselves a three-week reprieve to try to resolve the differences that led to the longest shutdown in history. how much the economy has permanently lost from the shutdown, but many analysts agree that first-quarter growth will be several tenths of a percentage lower than they had anticipated.

"An increase in refunds would be black of a shot in the arm at the right time, if it came in Q1, early Q2, "Mr. Feroli said. "It would be nice to have consumers sort of have something to smooth over that raw patch."

Ms. Zentner or Morgan Stanley

The shutdown, on the whole of an awful December for the stock market, has already contributed to a recent decline in consumer confidence. Such declines are typically associated with softening in spending behavior and increasing in savings as consumers' uncertain future.

"When the government is not functioning it quite scary for households," Ms. Zentner said. "You're just going to get up on top of another big pile of uncertainty, if their tax refunds are delayed."


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