real. so you know, we publish the tape on monday. by tuesday, it is on, you know, members of congress are playing it on the house floor and by wednesday, the president is signing an executive order that ends the family separation part of zero tolerance. >> you'll hear more from the finalist of the 2019 goldsmith prize for investigative reporting monday night at 10:00 eastern on c-span. you can also watch on our website or listen on our free radio app. "washington journal" is next. today is tax filing day. joining us later is peter sepp, president to have national taxpayers union and josh bivens from the economic policy institute. we talk about the tax season and the impact turnover 2017 tax law and then jason fitchtner and tax expert jeffrey trinca review

their reports on improving the u.s. tax system. as always, we take your calls and you can join the conversation on facebook and twitter. ♪ it is tax day 2019, monday, april 15. they argue at midnight. welcome to "washington journal." we will spend the bulk of the program looking at how the 2017 tax law affected your 2018 returns. what has changed? who benefits? who doesn't? how to further simplify your taxes. in the first half hour, we are going to ask you, how did you do on the 2018 returns? did you make more than expected? do you owe more than expected?

those of you getting refunds less than expected, that number is -- if you're getting more than you expected, that number is -- if you owe the federal government, that line is -- for all others -- we will welcome your comments on facebook. presidentfternoon the will be heading to minnesota to talk about what he is calling the benefits of the 2017 tax law. this is an associated press report. the headline "trump using text day to head to minnesota." president trump visiting a democratic stronghold in

minnesota. newly winning it in 2016. -- hasn'twhich gave given its 10 electoral votes to a republican since richard nixon came within 1.5% of carrying the state in 2016. in 2016, president trump came within 1.5 percentage points. he is coming to minnesota and senateder of the majority says he is glad he is coming. ahead of that visit, abc's ap talkedthat kevin hassett up the 2017 tax law during a teleconference with reporters on friday. he said it is working as its proponents predicted and it made the u.s. an attractive place to do business again. he also said the tax cuts

continue to provide sustained long-term nourishment for our economy. for all others -- the business section of the "new .ork times, code is all about many americans are paying less but many savings are passed along through payroll deductions. "if you're an american text since, -- taxpayer, ever president trump signed the tax bill in december 2017, independent analysis has consistently found that a large majority of americans would owe less because of the tax law. based on tax filings has shown

the same. skeptical.re survey conducted in early april for the times by the online research that form, surveymonkey, found that 40% of americans believed they had received a tax cut under the law. just 20% were certain to have done so. that's consistent with previous polls find that most americans thought they had not gotten a tax cut, and that a large minority but their taxes had risen though not even one in 10 households actually got a tax increase." just to go over some of the details about the top line key .hanges in the 2017 tax law the things that changed that you are beginning to see in the 2018 returns. adjusted tax brackets increased the standard deduction. it eliminated the personal

exemption. it did expand child and dependent care tax credit. helped.d -- it deductionted is just on home equity loans and introduced introduction for business income and on the corporate tax cut, that was reduced to 21%. how did you do? let's go to stephen in st. louis who owes the government. caller: good morning. my wife and i are both retired. we have pension and social security and my wife does freelance work as an educator. yeare every year, but this when i compared it to last owed 6000 three dollars less -- $1603 less to the government.

we didn't have any taxes taken out by my daughter. she was getting $80 more. we pay at the end. it was a benefit to me. i am going to go out and get me a secondhand car which we need. it benefited me. host: you didn't owe as much because your bracket was reduced or what? caller: i am not sure. the bracket with the standard deduction going up. i have a lot of deductions. when it was all said and done, compared to what i owed last year, i am unveiling it today. i'm looking at the envelopes now. i got $1603 less. host: let's hear from john next. he is in boston.

john getting a refund more than he expected. caller: good morning. , iis refreshing but, i think have been retired for 20 years. security, pension, stuff like that. , maybe three or four years ago. i just stopped a couple of months. for the past 20 years, after i retired, i have to pay every year -- i had to pay every year the taxes. everything gets taxed. 2016 -- in 2015, i made a substantial amount of money and it was through a gambling venture.

i have to pay so much back which was fine. when you make money, you pay the taxes. , theorst part was that following year my medicare went $100 toich was up over over $500 a month. that was the penalty for making the amount of money i made through a gambling venture. year, what was the thing that caused you to get more than expected? caller: i had worked the tovious year so i made $3000 $4000 more than what i normally would have made. i got a return. i got a return and i can only put it towards -- i wish i could explain it to you because i am not a tax consultant.

i put it towards the new tax laws. host: that is what we are doing, asking you about the 2018 return . how was it for you? did you get less than expected in terms of refund? if you made less, that line is -- --you get more than expected if you go the government -- if you owe the government -- facebook comment from john who posted this -- kendra says --

this one tweets us saying that our question doesn't get to the heart of the matter, as they have raised withholding tables to give people more money in their paychecks. again @cspanwj. let's go to philadelphia. this is stan -- dan who owes the government. caller: last year and this year, i usually pay about $1800 in taxes. much inr i didn't work 2016. i am retired. this year, i didn't work at all

in my tax bill was $218. aboutly is about -- it is $1800. i know some people think that is not a lot of money, but you can do a lot with it. host: let's go to rochester and hear from john who is getting a refund that is less than expected. caller: hi. thanks for c-span. i wanted to say we made the same income that we did last year, and we are getting about $3000 less in a refund this year. host: that is because you got into a different bracket? what do you think it is? caller: because we cannot deduct the mortgage. will be live in the suburbs of detroit -- where we

live in the suburbs of detroit. we make about $100,000 a year. the income stayed the same. extrawas no noticeable cash in our paychecks every week. reform -- this whole tax reform was for the big shots. host: john, thanks for the call. you may remember when the law passed, one of the leaders was kevin brady, the then chair of the house ways and means committee. this is kevin brady talking about the simple vacation -- the goal of simplification of the 2016 law. >> this is a complete redesign of the code so we can simplify it so much that nine out of 10 americans can file using a postcard filesystem, lowering

the rate. making sure we have strong middle-class relief. it is more than that. that is not just putting higher octane fuel and an old clunker of a tax car. we propose to drive a newer tax card that can compete and win. that redesign for simplicity, fairness and competitiveness, i predict under this tax reform plan america will fall from 31st in the world to the top three is the best places on the planet for the next new job, that next new manufacturing plant, the next new research headquarters. host: kevin brady talking about the 2016 tax law. 2018 was the first year it was fully in effect. we are asking you about your 2018 return on this text day.

-- tax day. also affecting charities as well. westis from the boston metro daily news. to arizona. owing the government this year. caller: good morning. yeah. i am retired. i am 65 and my wife is to deny.

-- is 59. last year she decided she wanted up aca because i would foul my motorcycle again. she got the aca, and halfway through the year she decided she wanted to get her social security credits up. she is 59. .o she got a job at walmart well, as soon as she got that job at walmart, she was supposed to call the aca and cancel it. she didn't. as it turned out when i got my taxes done, i'll the government $22,000 for that year, the whole year, that we had the aca. host: is that mainly because of the aca? or partly because of the income she earned? caller: it is the income she earned. they nailed us for the whole year.

we are paying off a $22,000 insurance policy that we couldn't even use. $6,500 apiece deductible. i really don't go to the doctor much because i have been in an accident a few years ago and broke 27 bones. i have been in and out of the doctor's office is -- offices. host: are you still covered? up gettingwife end insurance through walmart. i've got medicare. acastill having to pay the off $22,000. host: president trump heading to minnesota for rally to talk about the tax law and the economy. the views of the president's own

fors and calls by democrats the president to release his tax returns. this is the opinion page of today."day -- usa they write that -- another view of "usa today," their opposing view. would -- robert wood

writes that. you can read more at usa today.com. how did you do this year? let's hear from ryan and alexandria. caller: how are you doing? i noticed that on my tax return i made less individually. when you throw in my house, i made more in points paid. compare to at it last year, i think i made less. their softwarewn

-- host: in terms of the whole process, simpler? caller: the process was pretty fluid but i have been cheating for years using turbotax. it is pretty fantastic software. if i was doing it on paper i am sure it would've been more cumbersome. host: you mentioned turbotax. a lot of people use that. the idea that the federal government does provide some services under a certain income amount. should the government make it easier to do your taxes through the irs electronically? file foru be able to free electronically the matter your income level through an irs

product? as opposed to using turbotax? caller: i've noticed that federally and state-by-state, you can do it by freight -- do it for free. you can do federal for free but you have to pay for estate tax -- your state tax portion. regardless of the software, it tends to work out well. they all crunch the numbers the same way. usually the interface is similar. yoururbotax double check discounts friendlier. host: we go to bruce in south carolina who owes the government. caller: good morning. from being on the government programs to seeing taxes, so that is a good thing.

i don't look at it as a bad thing. living off the government for years and the trump administration says you are done with that. you got to work. now making $80,000 year working. i am excited to have to be able to pay my part and help out the tax system. host: does it feel like your owing more this year? caller: i've been taking money from them for years and living off the government. finally able to pay taxes, i feel productive and good about it. host: thanks for that. over the weekend, a couple of new candidates in the race. times, who digits -- buttigieg announces his run.

>> i would say all politics is personal. time and time again, moments in my life have forced me to realize what politics really means. i learned it when i went overseas on the orders of the commander-in-chief. when you write a letter and put it in an envelope marked "just in case" and put it where folks can find it, you never lose sight of the stakes. when i was overseas, each one of , driving aps i took vehicle, we learned what it is to trust fellow americans with our lives. [applause] the men and women, the soldiers, sailors, marines, civilians who got into my vehicle, they didn't care about democrat or republican. they cared about the route with

the fewest id routes just fewest -- fewest i.e.d. threats. if i was locked and loaded, not whether i was going home to a girlfriend or boyfriend. [applause] they wanted to come home safe like i did. they wanted what everybody wants, to do well and doing the job. making sure that kind of thing happens is what for -- is what politics are for. politics matters is because it hits home. host: you can find that at c-span.org. just type in "road to the white house." this is o'neill who owes the government. caller: good morning. host: you are on the air. o'neill, tell us your tax day

story. first ofst -- caller: all, we have been in that 24% tax bracket that our accountant tells us. every year i end up paying more than i think i should be paying. reform for the working person. i worked three or four jobs. my wife works through four jobs to put our kids through college. we don't rely on benefits to put them through college. we put them through college through our hard work. out that in and day people do benefit from the government by not working and getting paid. taking my money away but i put blood, sweat and tears and

indian that year i don't get, said -- and in the end of the year, i don't get compensated. host: did it feel like it was more this year? upler: every year it goes $4000. i am owing $10,000 this year. last year it was $6,000. i don't know what we are going to do next year. host: appreciate your call. the financial times writing about the effects that the loss of the state and local income tax deduction is having on some states and localities. raises newe "tax fear."

scott in dallas, texas. also owes on his 2018 return. caller: hi. how are you? i owe more this year, a considerable amount, because the salt tax cap.

i lost $3000 in deductions. texas has the fourth largest property tax writes in the nation. non-cash stock owe on, i/o on that -- i that too. my taxes went up this year and because of the barter transaction with companies buying each other, i have to pay quarterly in addition to my payroll tax deduction. host: have you always have to pay quarterly? or is this a new thing? caller: from year to year, it changes because you don't know if you're going to have capital gains tax until you get the 1099s. host: scott in dallas. your comments, calls, your reaction. what is the return like for you?

back to usa today. their money section. about some of the things you should know in terms of this tax day. in particular writing for maine and massachusetts residents. today is pictured today, a holiday in both states. , at day's emancipation day local holiday in washington, d.c. how to mail your return on time.

in terms of those of you interested in amending your tax .eturns, the deadline is today generally you get three years after the original filing deadline for that specific year or two years after the date you pay the tax whichever is later. that is available at usa today .com. we want to note that we are keeping around for news on the release of the mueller report after the attorney general barr's comments last week. writesl street journal -- his investigation, senior justice department officials have been reviewing in redacting the findings by

traveling between the department 's sprawling headquarters and the special counsel's office 10 blocks away. in theay, they were final stages, hashing out logistics of the 400 page report for lawmakers. let's get another call on our topic of taxes. we hear from virginia, who owes the government. i/o the federal government $2000. host: was that unexpected? caller: very. i have a part-time job. this is ludicrous. it is one of the worst programs i have ever seen. have you figured out what is behind that? why do you owe? caller: deductions.

write offs. not able to take the itemized deductions. you had to do the standardized deductions. caller: yes. carolinahouse in north . i lost a lot of that. the deductions were atrocious. it is geared toward the rich and the poor. the middle class is getting hurt. host: will you be able to afford the check you have to write to the irs? caller: i took it out of my savings, which did not make me happy. i did pay it. host: thanks for sharing with us this morning on the washington journal. we spend the program this morning talking about texting and what is ahead -- tax day and what is ahead. coming up, we are going to have the first of two roundtable discussions. petenal taxpayers union's

sepp and josh bivens will talk about the 2019 filing season and the impact of the 2018 law. later, jason fichtner and tax ca will talk trink about their report on ways to improve the u.s. tax season. ♪ >> the complete guide to congress is available. it has details about the house and senate for the current session of congress. contact and bio information about every senator and representative, plus information

about congressional committees, state governors, and the cabinet. directoryongressional is a handy spiral-bound guide. order your copy from the c-span online store for 1895 -- $18.95. ♪ >> the only thing we have to fear is fear itself. country canhat your do for you. ask what you can do for your country. >> the people will knock these buildings down. newest book, the presidents. noted historians rake america's best and worst chief executives and provide insights into the lives of the 44 american presidents. true stories and interviews with noted presidential historians. explore the life events that

shaped our leaders, challenges they faced, and the legacies they have left behind. published by public affairs, c-span's the presidents will be on shelves april 23. you can preorder your copy as a hardcover or e-book today at c-span.org/thepresidents or wherever books are sold. simply threeas giant networks at a government supported service called pbs. network with an unusual name rolled out a big idea. let viewers decide on their own what was important to them. c-span opens the doors to washington policymaking for all to see, bringing you unfiltered content from congress and beyond. in the age of power to the people, this was true people power. in the 40 years sense, the landscape has changed. there is no monolithic media, broadcasting has given way to narrowcasting, youtube stars are

a thing. c-span's big idea is more relevant today than ever. no government money supports c-span. its nonpartisan coverage of washington is fumbling -- funded as a public service. on television and online, c-span is your unfiltered view of government. you can make up your own mind. washington journal continues. host: it is tax day 2019. here to talk next about the impact of the 2017 law until the ouream return is going pete sepp, president of the national taxpayers union, and josh bivens of economic policy institute. you may have heard some of the conversation the first hour and how it is affecting some of our viewers and listeners. how do you think, pete sepp, the 2018 returns look for most people? guest: the reductions have been

that 80% of filers would experience some kind of tax reduction on their returns by percent and increase. the remainder, roughly even. it seems to be working out that way. we will not know for sure until the filing data is in and more people are actually delaying their filing, applying for an extension. that is going to have some important data we will not know about for a little while. economically, i think the honest answer is it is too early to tell with the overall impact is going to be. you see signs in employment and wage growth and fixed investment, but whether that is short or long-term no one can be sure. plus, the fact that the intent of the tax reduction law really was not to deliver immediate kinds of boost through the corporate reduction. it was to affect investment over the long-term. that is hard to pin down, especially when you have other things going on like the trade

war that the trump administration has launched. that impacts the economy in a negative way. your take on the impact of the 2018. what you think it looks like compared to previous years? guest: in terms of individuals doing their taxes, it depends on their circumstance. one think we should keep in mind is the centerpiece of the law of 2017 was a corporate tax reduction and that is not affecting individual people's returns. the way that is going to filter through the economy is people who own corporate equities are going to get higher dividends, higher capital gains in future years. it has probably not filter through this year. that is skewed for the top set of people. for the rest, it depends on whether people get business income. one of the other big pieces of the law was deduction. for people who get most of their income from w-2 wages, i think any effect of the law is going to be year-to-year variation in what they make.

they are not going to see a big effect. economy wide, there is little evidence that the tax cut has done anything at all to help boost the economy. i do not think it will. it certainly has not so far. host: you mention people have delayed in filing this year. is that because of the newness of the law or do we know? guest: i think it is the newness of the law. we do annually a study of complexity administration the tax system. areof the big questions was the 15 or 20 million folks who longformuse the with its associated schedules to take itemized deductions will those people shift into the newer form and opted to fill out fewer schedules, take the standard deduction instead? it seems that that trend is being confirmed right now. that is important because one of

fromew supplication gains this law was more people would take the standard deduction. that could mean a reduction in paperwork borden's -- burdens. and moret reduction people taking the standard deduction means fewer people are itemizing. ofks like that is where some the bite might be for some taxpayers. they are not able to deduct with the use to. i'mt: cards on the table, not a big fan of the law. one piece that was decent was the increase in center deductions for supplication -- simplification. it is hard to imagine too many people being made worse off. if you do not have 24,000 dollars in deductions before, the standard deduction gives you that much and you are fine. taxes change for people year-to-year. there income changes.

their employer withholds more or less in a given year. people are trying to figure out why their taxes are changed. i do not think the ship from the bigger standard deduction and some of the caps on the itemized is the thing driving it. bivens anduests josh pete sepp with us to talk about the effect of the 2018 tax returns of the 2017 law. we welcome your comments and clause -- calls. republicans, it is (202) 748-8000. for democrats, (202) 748-8001 .or all others (202) 748-8002 some of the effect of the tax law the wall street journal. the wall street journal is reporting the biggest winners were shareholders. tax savings contribute to a banner year for banks, but the passingest banks are $120 billion in combined profits.

stock buybacks have surged by $20 billion from 2017, more than the tax savings. they write businesses have been electing to give workers short-term payouts for morale rather than long-term increases hadage the economy experience in previous decades. wall street journal says the trend of bonuses rather than a permanent wage increase continues. a researcher -- report -- a recent report by the federal reserve says -- is not permanent and can be withdrawn. we have seen this in a number of industries across the country. is this a new fixture that is likely to be a permanent fixture instead of a pay raise? a bonus because part of the equation. guest: i hope not. the intent of the tax-cut law was to increase private investment over the long term as well as productivity, which shows up in wage growth. a former cbo director testified at a hearing about 2.5 weeks ago

on the short-term impacts of the law and stressed that is not where we should be observing the beneficial economic impact. he thought that private investment is up a little bit. gdpd investment as part of trending northward. some of the wage growth trending northward. can that be attributed fully to the tax-cut law? no, probably not. you cannot isolate policies that easily. it is an encouraging sign that two or three years from now we might still have a little bit of wind and the sales of this economy. host: josh bivens, not a fan of that tax law. part of it reduces the corporate tax rate from 35% to 21%. what have we seen at the impact of that? guest: you have seen a big increase in after-tax probability -- profitability of corporations.

some of that has been given to shareholders in the form of higher dividends or a capital gain because of a stock buyback. that is a set of benefits that accrue through the top. the top 1% owns four deep -- owns 40%. that is not a broad-based income increase. i think the tax cuts they hope eventually that lower corporate forrate does filter down more tangible investment and increase productivity. the evidence is weak. if you look at when the tax-cut was passed, you see no change at all the trend of private investment. they always say it might take more time and it has not happened yet. i think even over time i am dubious it will happen because we have had record high after-tax corporate profitability before the tax-cut but investment was sluggish. that says to me that that was not the thing holding back investment in this economy. low profitability was not the thing holding back investment.

profitability was high. i do not understand the description that says it was high before and let's nudge it higher and that will turn the tables. research for the economic policy institute. what signs are looking for for the effect of the law a month, two or three or four months out. -- out? guest: is tough in that short term. corporate taxes went from 35% to 21%. you see that in the data. corporations had to pay a lower rate of taxes on their profits. you see that jump. what you look at over time, i think the linchpin of the law in terms of its effect on helping a broader group in the economy is what happens to private sector investment. the economic case for why this might be good for a broad group of people as it will spur business investment.

you look at trends in business investment and that is what i'm focusing on. in terms of the overall effect down the road? guest: most certainly. towards geared primarily a major reduction in corporate income tax. the other key component is the so-called 100% bonus depreciation allowing companies to write off upfront any of the investments they might otherwise make without the complex depreciation schedules. the problem is that is only good until the year 2022. you already have a clock ticking for many people making investments in corporations and thinking either we need to do it right away or we might as well forget it. that is a key defect of laws like these and that if you do not have a provision that is consistent over time it becomes more difficult to measure in terms of its impact.

host: what does the national taxpayers union do? nonprofit,re a nonpartisan citizen group. we think that the administer as important as things like rate and distribution. unfortunately, this law, with the exception of a few of the individual provisions such as shifting people toward the standard reduction, does not do much work supplication -- for simplification. the national taxpayer advocate estimates a range of possible appliance cost with our system all the way up to $800 billion a year including opportunity costs. you cannot ignore that. to the extent that we can simplify especially in areas like the income credit, people are going to gain, middle-class and working-class. host: let's see what our viewers

and listeners are thinking about on this tax day. let's hear from gary in newport, kentucky on the republican line. federal and ity seemed like i got a cut there, a break there, but i found my state, which used to have a cap a $2000 but they had a $42,000 but the state of kentucky lowered that cap and i ended up having to pay it back. i broke even on the whole thing if i ever saw any change at all. consider all levels of government as far as the tax burden is concerned. one particular issue with this law, as with many others on the federal level, is whether states choose to conform their tax codes with changes that are made at the federal level.

many states do what is called have aing and will not parallel credit or deduction, especially i have seen this and states toward the funny percent small business deduction on the personal side. host: any thoughts for our caller in kentucky? guest: i agree. it is important for people to think about the tax system overall in this country. level, wee federal have different kinds of taxes. you have federal income tax, which is what today is about. you also have a corporate income tax. different parts of that system are different in terms of how progressive they are in their incidents or not. i think one of the reasons why i'm not a fan of the 2017 law as it looked at one of the most progressive parts of our tax system, the corporate income tax, and decided that was the thing that needed to be cut. yet, it did not cut payroll taxes. it did not do anything for state and local because that is outside jurisdiction.

if you're looking at the whole portfolio taxes the face american families, this law said let's reduce the ones that pay by the richest households, leaving the rest of the tax system unchanged. that is a big problem for me and a big burden for a lot of people in other parts of the tax system. over the weekends -- twice as many companies paying zero taxes under the trump tax plan. it lowered the corporate tax rate from 35% to 21% in its first year. the number of companies paying no taxes went from 30 to 60. michael, independent line. caller: i have a comment and a question. security and back in the 80's they passed a law. i think it was al gore that pushed it over the top. of your social

security and counted toward your income. i am one of the lucky americans that has a pension, but i had to pay under this new tax-cut law $395 more. i am already tapping into my savings every year just to make ends meet. we haveion is this -- been giving these tax cuts to corporations and the fatcats since reagan's time. it has never worked. in has never trickled down, and i would like your guys to explain to me why come out like crazy people, do we keep going and giving tax breaks to people that are not going to do anything for this country -- economy except by our politicians? i would start out by saying there is a fair amount of research that indicates that higher taxes have negative

impacts on economic growth. tax foundation reviewed 26 separate pieces of literature done over two decades, three threes, found all but determined there was a negative correlation between high tax rates and economic prosperity. as for the trickle-down effect, there has been research going back and forth on the effects of these laws. a lot depends on how they are designed. one thing across the board reductions in the 1960's after atn f. kennedy were measured increasing employment by 0.5 to 0.8%. revenues increased to the federal government after enactment of the law. you cannot isolate those impacts, but the evidence is mixed. host: do you think the trump administration learned anything from the reagan experience? guest: not really.

thismostly with michael on one. i think cutting taxes on the rich and powerful is not an economic strategy that has paid off. at least under the reagan administration, they did large tax cuts and increases. part of the reagan tax legacy that has some bipartisan support is the 1986 tax reform, which did try to do supplication -- simplification. i would say the 2017 law learned nothing from that. it was passed so hastily. i was one hearing in congress think the changes they made to the corporate side have left huge loopholes all over the place. you mentioned twice as many corporations paying zero taxes the are before. that is in year one. what we know it's corporate accountants learn over time how see this you already hemorrhaging of revenue. i would say they did not learn any of the good lessons of the reagan tax legacy.

they only took the bad ones, which is delivering benefits to the top. host: let's hear from david in san francisco. am calling from the land of hyperinflation. we have been so exposed to fraudulent numbers for so many years that we are kind of -- america was founded on taxation with representation. the people who get taxed get to run their own lives. now, if the super rich do not want to pay taxes as they are not paying taxes, why do we allow them to run our lives? the structure of this current screwan is designed to us. how did currency speculators pay taxes?

we will let you go, david. we will get one more call from thomas in texas on our republican line. caller: it is little elm, texas. for those people who are working right now, i would suggest they go to their human resources or to -- have ago percentage taken out with holding. i would say 10% or 20%. that will allow you to have more pay in your check after you have figured out you can do that. you can have more pay and your check as it is now the tax law, the new tax law. with this withholding at a higher rate, you can also have a substantial amount of money coming back to you at the end of the year. for those people like the gentleman who was on retirement

anh a pension, that is earned income additional to your social security. if he had taken a lump sum at retirement, he would not have been involved in that because he would have had maybe some sort account where they would send in a certain account, his checking which are not be counted as an income. i have a phd in accounting. i know what i'm talking about. i know.pect thanks, thomas. up thethey springs interesting issue up withholding and refunds. i think probably the worst journalism we saw about the tax-cut law and this year has trackinghysteria over the weekly average amount of tax refunds and saying that has got

to be because of the tax-cut law. is simplyn your taxes an overpayment made to the irs route the year without getting any interest for it. it turns out that the refunds are pretty much about the same this year as they were last year on average. different people are going to have different experiences. they always do. the point i think that needs to remains tooe system confusing to too many people and adjustry for folks to that withholding to the point where they might come out relatively even. people are nervous about running afoul of irs penalties for under withholding. so going into his hr office and changing the withholding -- there are some

folks that are afraid of doing that. at the very least, not very knowledgeable about what they should be doing. so they come out even or they get that small refund. guest: i would say all that is right. i do not think out give people blanket advice to tell their employers to withhold less. we are al lawson verse. -- all lost a verse. bit this year. it hurts a because we are human. i would not give like it advice. the part of the law that should have been straightforward for hr department to figure out is how much to withhold from w-2 wages. my strong guess is they mostly got that right so there should not be a effect. it is the people who have more complicated income forms. they own a business, things like that. that gets more complicated. the issue of the debt has

come up regularly. i want to play you some comments from national economic advisor larry kudlow about the effect of the 2017 law on the debt. here's what he had to say. [video clip] >> one economic indicator that has been bad news recently -- you are critical of the deficit and debt levels in the obama administration. we got a new level of the first half of the fiscal year. we are looking at trillion dollar deficits. democrats say a big part of that is the tax cuts. are the tax-cut paying for themselves? >> yes. >> some experts say absolutely not. >> they always will. >> we are talking about nonpartisan experts. >> i have to process that, nonpartisan expert part. i will think about that. interestingly, i just saw

february, march, year on year, the federal revenues are coming a dayn you adjust for short in march or a day short of february. about 9%. revenues are coming in nicely. is,lieve what happened here as a share of gdp, which i think you have to look at these things as relations to the economy, you will see the deficit on a steady clock lower. same for the overall debt. host: based on what you heard from larry kudlow and other research you have, are those tax cuts -- will the tax cuts pay for themselves? guest: no. i think the economic growth generated by tax cuts can offset the so-called budget scorekeepers who call static

revenue losses by the term dynamic analysis is a way of building an economic growth to incentives such as reduced rates or expensing of your investments. there have been some estimates that the long-term revenue lost dynamically from the tax-cut law is about $5 billion as opposed to even $2 trillion. i think it is somewhere in between. you cannot discount economic impact, but paying for themselves is a stretch. host: if you are thinking that -- andporate tax cuts those revenues from those taxpayers, is that what he is talking about? growing the federal tax revenue that way? guest: there are two channels through which they could affect the economy. one is a short run channel, giving people in the economy more money to spend. if dividends go up, if stock buybacks, people feel richer,

they spend more money. a stimulus effect. the tax-cut had limited stimulus effects for a couple reasons. one is it directed a lot of money toward the top people who do not spend every penny they get because they have a lot of money. two, the economy did not need short run stimulus by the time the tax-cut ran into it. tohink what he is referring is something like a corporate rate cut. it has been long-run effects. tobe it induces businesses undertake a little more tangible investment and increase productivity which hopefully increases wages of workers and then those higher wages pay more in taxes so you get revenue over time. there is very little evidence that that long-run dynamic is -- has happened yet. i am skeptical never comes to pass but that is the hope that over time you get more revenue. it hasn't happened yet. host: you mention people at the top.

had an article about state and local income tax. out?o you see that playing guest: how that plays out a couple ways. the state andon local taxes that you can write off on your federal income tax return. that was part of the law that raises revenue because it is a cap on a deduction people used to take in an unlimited way. from a state and local perspective, it makes it harder for them to paid -- raise taxes. in the past, new york could raise taxes and say that may hurt but you can write it off on your federal. run it putr the long a strain on fiscal resources that states can raise. on the other hand, it is an inefficient way to help states raise resources.

we could just increase federal aid to states rather than allowing state and local tax deductions. a a standalone way to finance generally flawed tax-cut, i'm not a fan of that. i think in the long run we probably should figure out better ways to get aid from the federal government to states. host: let's hear from a caller one of the states. david, new york, democrats line. caller: my name is david. -- thestions or comments standard tax or standard 12,000 and itnly makes it 1300 for seniors. more than $50,000 to an individual, you have to fill out what is called a form 709. it is a gift tax. in 2017, the maximum gift tax

was $5 million. in 2018, each individual is allowed to give over over $11 million. to $11 from $5 million million. you know who is going to benefit from that. that is it. guest: those were part of the changes of the tax-cut law to the estate and gift taxes. the state tax exemption rose dramatically. thewhole point of inheritance and gift taxes has been to try to redistribute wealth and reduce inequality. the evidence is mixed on that. that is why folks like brookings institution have suggested maybe we need to raise the exemption from the tax indexes to inflation, make some other

adjustments, so that it is not quite as distortion it on medium-sized family-owned businesses. we have moved for that direction. there are some economists would suggest that in the long run for the revenue it raises mip worth getting rid of entirely. be worth getting rid of entirely. host: we talked about corporate rates being reduced. andwill small businesses do -- under this law? guest: the corporate tax rate does not apply to most of your mom-and-pop businesses. they are sole proprietorship's that file through the 1040 system. 50,000 are the want to pay the corporation income tax rates have been migrating out of that system year after year. they have been forming their businesses in other types of structures. caller: let's go to -- host: let's go to jackson,

tennessee on the independent line. caller: good morning. the system is not crippling our business around the world. it is health care. in 1960, corporate taxes were 4% of gdp. today, it is about 2% of gdp. health care was about 5% of gdp in the 60's. now it is 17.6% of gdp. taxesfett says, it is not that is an impediment. it is a distraction. it is health-care costs. six land dollars a year -- we spend $6 trillion a year. we should not be cutting taxes for the wealthy. use insanity to cut these taxes. -- it is insanity to cut these taxes. host: any thoughts? guest: i think there is a lot of

truth to that. on the first point that u.s. corporate tax rate before the 2017 law was not an impediment to u.s. corporations, i agree. there are a lot of claims that the u.s. corporate tax rate was somehow hurting our competitiveness in a global economy. it is not true. mostf the rate corporations after they got there encounters a raise -- of all pay less than that -- got there encounters an vault paid less than that. accountants involved paid a lot less than that. -- that seems like looking at the wrong ways for relieving economic stress. about the fair share. here are frustrations the pew research center has found in their latest report. top tax frustrations -- feeling

some corporations and wealthy people do not pay their fair share. feeling that some corporations do not pay their fair share. feeling that some wealthy people do not pay their fair share -- 60% -- 62%. barry, independent line. -- mary, independent line. caller: i belong to a club. it is a women's club. 11 out of 19 people have realized after paying their , mostly republican women, that they have paid a lot more than last year. working classhe has been hoodwinked. this trickle-down economics is a con game. making 1% of the rich richer.

it is adding to my $5 trillion trillionficit -- $2.5 to the deficit. we feel that larry kudlow is a trump and mitch mcconnell. trump and the republicans have ripped down the common working class. and your own experience in terms of your own tax bill -- more than you expected in terms of what you are paying this year? caller: my husband does the taxes. he mentioned we are not getting the deduction we got last year. the doug -- the deduction is a lot less. guest: it will be good to put this into perspective. even the congressional budget office says that our tax system as currently stands is progressive. suggests the

industrialized nations around the world -- suggest that our tax system and comparison of many other countries is highly progressive. top 10theavily on the of earners to finance a great deal of our government. the top 1% pay an effective of about 33%.te that is the most recent data. that is down two points from 1979. paybottom fifth of earners less than 10%. about 5%. that is way down from 1979. if you want the system to be more progressive, ok, but you say it is not progressive currently -- the facts do not support that. the fact that we have individuals getting away with a low tax bill does not change the

overall picture. host: here is joanna in maryland, democrats line. caller: i remember an old where you would say i would pay you tuesday for a hamburger today. that is what is going out of the tax code. the deficit is exploding under trump. the debt is going up. at some point, somebody's going to have to pay for it. the second thing is that it is all about me now. it is not about us. departments -- federal departments are being drastically slashed, to a dangerous point, including the agriculture department. you had somebody on from the national farmers union the other day. the agriculture department, homeland security, everything is being cut. operate tos money to

do the kinds of things we need to do in the federal government. the people at the lowest end the economic strata are really getting hit hard. the people who can least afford andave a higher tax burden not as many services. i would like you to address those things. guest: i agree. in the long run, if we want to have an effective government that provides vital services for a broad range of people, we will need to tax people more. to me, the natural place to look for more money to start is the top 1% and 5% that has seen a hugely disproportionate income gains. we have seen a bunch of money at you millie at the top -- accumulate at the top. on the issue of the deficit, i am not that concerned about the deficit.

i look at long-term interest rates. they are low. i think the increase in the deficit is often utilized in a cynical way. you have a group of people, republicans in congress, who passed a $1.5 trillion deficit cut and in the present's budget they scream about deficits being too high. that to me is the worry about the politics, the political use of the deficit. the economics do not scare me. politically, they are used as a cudgel to beat back services for a broad range of people but they never seem to be in play when we are talking about tax cuts for the rich. pete mentioned the earned income tax earlier. america's anti-poor tax law. they read you would think the irs in an effort to bring in more money would focus primarily on auditing wealthy taxpayers.

as republicans found in a disturbing piece, from late last year, recipients of the earned income tax credits aimed almost exclusively at the working poor were twice as likely to be audited as people earning to a $200,000 to000 -- $500,000. of the a large swath southeast to the desert west -- remind us of the earned income tax. who gets that? guest: i talked with the reporters on this story. they do not cover one issue well. the earned income credit was a program created over three decades ago, designed to offset the income and payroll taxes that working families are liable for. it is an anti-poverty program

that is efficient compared to things like the snap program. one problem with the earned income credit is the obsession with improper payment rates. there are improper payments in the program, but recently was discovered that by holding these credits at the irs while they verify income and eligibility, many families are being deprived of an important short form -- term source of gas. -- cache. cash. problem withuine over auditing in that program. we have a problem with the simpler city of that program. if you are a cash simplicity of that program. if you're able to claim a child

tax credit, you should be able to claim in earned income credit. the irs commissioner was asked about this auditing by senator white. the issue came up at a hearing last week. [video clip] >> i want to ask you about earned income tax credit recipients being more likely to get audited then millionaires. you heard me go through the numbers. i think it is shameful that poor folks in humphreys county, mississippi have the highest audit rate in america but if you are a high flyer or somebody running a company, you are not likely to get audited. tax credit audits make up a higher percentage of total audits since republicans have taken the budget act to irs. here's my question.

is it really the intent of the internal revenue service to audit taxpayers who are struggling to make ends meet while increasingly letting millionaires and multinational corporations off the hook? is that the intent of the agency? >> no. we are looking at the earned income tax credit. part of the problem with the statistics is there is in $18.4 billion overpayment each year associated with the earned income tax credit. we want to work with congress. we are going back to see every proposal since 1975 to reduce the complexity. the majority of issues revolve around the definition of a qualifying child. we would hope that working with congress we can come up with a better application or an understanding and acceptance that this is a social program. i wouldd the chairman stay with them five minutes. this is my view. the stark contrast between the

fact that the poorest and most vulnerable get audited more than multimillionaires is more hard evidence that the tax system is stacked in favor of the wealthy. host: it sounds like the senator and the irs commissioner agree on one thing. there are issues with earned income tax credits and auditing of people getting that. i think we need a better resourced irs. even the congressional budget service says every dollar you get the irs saves the government money because they are able to do enforcement and bring in more dollars and we need a radical reorientation of the priorities of irs enforcement. it is shocking how much they are focusing on people who are struggling and do not have time to deal with this. there is not a lot of money there. there is a lot of money in the various loopholes and accounting shenanigans undertaken i the top 1% and corporations.

that is where most of the irs enforcement attention should be and it has not been recently. where the things authors of the article got wrong was in the audit rates of the largest companies. for example, 20 billion dollars of cash flow a year. the audit rate is 58%. it is not as if the irs is not looking at these companies. the other thing is a large portion of the tax gap on the individual side of the $290 billion estimated, almost half of that is coming from the so-called schedule c filers, small businesses and sole proprietors. some of them are wealthy and others are not. we have to be careful about the powers we give the internal revenue service. we have to balance those auditing powers with more taxpayer rights. congress just unanimously passed the taxpayer first asked to do just that, a great

bipartisanship example. bivensete sepp and josh welcoming your calls. (202) 748-8000 for republicans. (202) 748-8001 for democrats. all others, (202) 748-8002. dave is on the independent line in new york. i dor: i want to say that taxes for myself and for two friends of mine as a third party designee. i found it to be much more complicated because of those six silly schedules that took 1040 and trotted into pieces. some of those schedules i filled out on three lines. why can't they be put back on the 1040? i sent a long a mall describing how much more complicated. one of my friends was a 1040 filer and now there is an extra schedule for my own information.

you have all that blank space on 1040. put the stuff back so you do not have to send eight pages for a return that has three numbers. as for my own, i am paying a little bit more because my income is investment income. the loss of the personal exemption greatly outweighs the -- any increase in the standard deduction. i ended up having more taxable income, which because of pursley tax code had a marginal rate of 27%. that is 12% on the ordinary income. this whole thing is lousy for preparing returns and it cost me more money. it did save my friends some dollars which is good for them but not good for me. host: we will spend the next hour talking about potential changes to symbol phi the tax system. system.ify the tax guest: congress love to talk about simplification and they

almost never deliver on it. they have higher priorities. in the case of the 2017 law, it was delivering a rate cut corporations. there is low hanging fruit to make it more simple for tens of millions of american families. real tax reform would do that. host: you mentioned you mentioned he thought the irs was under resourced. you think the irs is reeling from the scandals and the obama administration? guest: yeah. if you look at full-time employees or dollars for return filed, you see a downward trend since 2011. host: what do think of dave's experience with the new forms? guest: this is political. of apt hearing the mantra postcard-sized tax return and the treasury try to design one that looked close to that without thinking about what this was just this size for

everybody? there is a proliferation of schedules that was unnecessary. in the end, when it comes to the irs being under resourced, it needs to be resourced in the right way. part of the trump administration's budget proposal has an increase for the irs, but it is shifted toward enforcement. i think it should be shifted toward taxpayer services. if you give people good advice on how to comply with the law at the outset, you will have fewer problems at the opposite end of the system with auditing and collections. host: on the line is barry in new jersey, republican line. caller: two questions. can you tell us what the status is for the middle class tax cut that was talked about after the announcement of the original tax cut? what does the new tax code provide for golf courses? we will hear from

bellevue, washington on our democrat line. they have permanent tax cuts, the wealthy, and everyone else is temporary. that -- do not believe the entire personal tax rate reduction schedule is temporary, whether you are paying a highest rate or not. corporation reduction is permanent, but not only the rate , not the expensing or the other provisions. guest: the current personal rates expire in 2025. guest: 2027. host: why do they have an expiration date? guest: my guess is they wanted to keep a 10 year budget deficit. think -- they not wanted to keep you protected --

projected deficit smaller. host: let's hear from marion in athens, georgia. caller: i have a question. i hear you talking about unfairness of the check system and how it is skewed to the wealthy. what about other taxes? what about medicare -- social security and why there is a cap? or a person who has low income pay the maximum and then is cut off for people who have the most money? , if theor medicare caller is referring to the payroll tax, there is on medicare. there is one on social security. that is a topic for serious debate when it comes to social security reform. there are republicans as well as democrats saying if they make a deal on helping to maintain

social security's financial solvency, maybe you do things like raise the retirement age, change the benefit formula, and raise or get rid of the cap on payroll taxes. host: what is the current payroll cap for social security? $125,000.l over host: do we know the last time it was changed? guest: it has been cap there for quite a long time. guest: it changes annually. guest: for inflation. the base amount has been like that for some time. host: let's hear from glenda in minnesota. good morning. the president is headed to minnesota today rid our independent line -- today. our independent line. caller: i always hear about the top 10%. when you tell me what the bottom salary for combined income, two

professional people in california, what is the bottom of the 10%? many people will be surprised that they were the 10%. i would like to know the bottom of the top 5% is. i seem to think that is where we are. we pay almost 40% of our income in taxes. we have various pensions and such. i would like to know that. guest: it depends on what you measure. for the income tax at the federal level, the adjusted gross income threshold is about $139,000. for the top five, it is $197,000. that is for 2016. host: what were the most significant changes they made in the individual tax brackets are the 2017 law? where are we seeing the most significant change? guest: there are seven brackets for the rates were reduced

anything between 2% and 4% depending on which bracket. guest: most of the action of the 2017 law was not just in the simple individual rates in brackets. facebook, we are taking your comments. facebook.com/cspan. a post says the reduction in pay check re-holding -- withholding was a shell game. i've always got them back $3000 but this year owed funny five -- this year owed $2500. i would have paid only $500 with the old withholding. this seems like a surprise for this viewer and the withholding. guest: although he says he got a bonus as well. that does increase your taxable income. that is the system. you are going to pay progressively higher rates if you are bumped into a higher

bracket. host: part of this gets back to the talk about people being aware with their w-2s and where they stand on that. of thethe lateness passage in 2017 -- it was barely before january 1. i do not think it was the most well vetted law in the history of tax reform. it happened in a rush. it left the irs scrambling in terms of withholding instructions to employers. there was worry at the time that there will be overshooting, undershooting. we will see when the data comes out. my guess was there is more overshooting and undershooting on the withholding this year than in previous years. host: let's get one more call for the both of you. marshall, republican line. caller: i have a question relating to lower income people and their payment of taxes. one of the things

if you're on a w-2 or 1099 employee, what's the thought of the panel on how compliant our country is in paying taxes. guest: well, there has been research done on this, and i'll let josh chime in, too, about how you have two ways of compliance before the auditing stage. you either have direct reporting, such as your wages get sent right to the i.r.s. for your employer. they know already how much you made. or you have very serious, upfront income documentation. you have to fill out a schedule in detail. where you have neither of those two, the compliance rate is lowest, probably less than 90%, well below 90%. when you have both of those, it's above 98%. if you have only one in between

. guest: yeah, my sense is the sort of typical american family is pretty compliant with the tax code, not just because of the goodness of their heart. it's because we have employer withholding, which is a key way of doing it, and i think that's the way it should be. we should make it ease and i patriot hard to escape complying with the tax code. ost: josh bivens and pete sepp , thank you for being with us on this tax day of 2019. we will continue the conversation, we'll focus a bit more on further ways to simplify the tax code. we are joined by two guests in the next segment as well. as "washington journal" continues. expert, htner is a tax and jeffrey trinca will discuss ways to improve the system. we welcome your calls and comments as well.

>> the complete guide to congress is now available t. has lots of details about the house and senate for the current session of congress. contact and bioinformation about every senator and representative, plus information about congressional committees, state governors, and the cabinet. the 2019 congressional directory is a handy, spiral-bound guide. order your copy from the c-span online store for $18.95. >> the only thing we have to fear is fear itself. >> ask not what your country can do for you, ask what you can do for your country. >> and the people who knock these buildings down will hear all of us soon.

> c-span's newest book, "the presidents," noted historians rank america's best and worst chief exec activities, provides insights into the lives of the 44 american presidents, true stories gathered by interviews with noted presidential historians. ex-plorte life events that shaped our leaders, challenges they faced, and the legacies they have left behind. published by public affairs, c-span's "the presidents lts will be on shelved apes 23. but you can preorder your copy as a hard cover or e-book today at c-span.org/thepresidents, or wherever books are sold. >> once tv was simply three giant networks and a government-supported service called pbs. then in 1979, a small network with an unusual name rolled out a big idea. let viewers decide all on their own what was important to them. c-span opened the doors to

washington policymaking for all to see, bringing you unfiltered content from congress and beyond. in the age of power to the people, this was true people power. in the 40 years since, the landscape has clearly changed. there's no monolithic media, broadcasting has given way to narrowcasting, spud tube stars are a thing. but c-span's big idea is more relevant today than ever. no government money supports c-span. its nonpartisan coverage of washington is funded as a public service by your cable or satellite provider, on television and online, c-span is your unfiltered view of government. so you can make up your own ind. >> i think it is important on this day that we continue to offer the people of colorado, people of littleton, the families involved, the knowledge that all of america cares for them and is praying

for them. >> 20 years ago, the columbine high school shooting was one of the deadliest high school shootings in american history. on thursday at 8:00 p.m. eastern, we'll look back on the shooting and provide some reflection on the tragedy. >> at that time, columbine had never happened. and neither the parents nor the school counselors looked at the issue of a violent paper as something that was indicative of the possibility of some real deterioration in thinking. >> watch our special on the 1999 columbine high school shooting thursday at 8:00 p.m. eastern on c-span. >> "washington journal" continues. host: on this tax day 2019, we continue the conversation. in this hour, we focus a bit more on ways to improve the u.s. tax system. helping us do that with two guests, jason fichtner, a fellow at bipartisan policy center. we'll look at some of their recommendations for improving

tarks. and also joining success jeffrey trinca, vice president at associates. gentlemen, the idea of a post card by tax reform -- tax return, rather, came up from comments from kevin brady and others. whatever happened to the tax post card? guest: oftentimes reality gets in the way of ideology. we would love to go to a point where we could do fooks a post card, but the u.s. tax system is designed to have a a lot of social in the tax code. dwee a lot of things for child tax credits, variety of rates and deductions. we have small business income. we have flexity in our daily code. the more flexity you have, the harder it is to get the form smaller so. we basically can't put it on unless you have a flass tax. guest: jeffrey trinca? guest: well, they have a post card, down to half a page. unfortunately, most of our

printers print out at 8 x 11. what you have now is a bunch of awkward schedules that come after it. it's going to be interesting to see if people apply for the student loans and their mortgages and they're dealing with forms they're unfamiliar with. ut in reality, people that are practitioners, people use software, self-help, and they don't actually see the form. you get essentially an interview, and then at the end you print. you know, i was kind of surprised at the end when i printed it out and said, oh, ok, this is what it looks like. i spent half a day doing my taxes and haven't seen the report. host: let's look at some of the recommendations for the bipartisan policy center in a second, but what do you think? looking at this tax law, what are a couple of ways that still

it could be simplified further, the whole process could be improved? that's not been done under this tax law. guest: well, jason and i, we might have different ideas along that. i mean, i'm more of a tax collection purist, i guess. the more social welfare that we try to push into the tax code, the more complex it is. so if you're helping low-income folks through the i.r.s., if you're encouraging people to use electronic cars, if you're encouraging them to invest earlier, then that's going to add complexity. if you have a situation where you had one or two rates and the i.r.s.'s main job was essentially just to collect taxes, it would be a much simpler system. but if we're going to have a system that does these social welfare programs in the internal revenue code, you're always going to have it.

host: the tax administration report on compliance, complexity, and capacity just released ahead of tax deadline day today, and part of that includes providing adequate funding in terms of the i.r.s., simplifying and consolidating tax credits for low and moderate income filers, improving the i.r.s. hiring and training process, more oversight of tax return preparers and strengthening the service programs, such as volunteer tax preparation. do you feel that some of these things weren't addressed under the 2017 law? guest: i think this is important to point out that the bipartisan report was between myself and the brookings institution. the three of us have a lot of years working in tax policy. i worked for the i.r.s., jeff was part of the restructuring. we bring a lot of experience to this. this was designed from a policy standpoint to try to get a lot

of various different political votes. you have to pass it. to jeff's point, we actually agree. the more things you put into the tax code to give certain favorites or breaks, the narrowing of the tax breaks. what we'd like to see a broader art. a lot of these policies are nut in place without consultation with the i.r.s. about how to administer this. this led to a problem you see this year, where a lot of people are filing their taxes today, and they "owe money." they're wondering where their refund is. they incorrectly assume their taxes have gone up. what happens is their taxes were lowered, and they got more back this their paycheck each year. their withholding was lower. so they owe money, and that akes them seem they owe taxes. they did get a tax break so. we traded off the idea of getting less and get a refund.

that created confusion. the i.r.s. rushed out the withholding tables. host: it was pointed out that the lightness of the passing of the law late in 2017 meant the i.r.s. was scrambling quite a bit to get the withholding guidelines and tables together. guest: yeah, actually they haven't come out with a redesigned w-4 yet. what they did was they juggled the schedules around for businesses, and that added a lot of confusion for folks. you know, they may not have noticed that extra $50, $100 in their paycheck each time. nd then others, you know, in high-tech, state taxes states, they're going to see a difference. not a difference of a tax increase, but in some situations not. you've taken away some deductions, but you've also lowered and redone the rates. so it's hard to tell until you

do it. host: our guests with the bipartisan policy institute, we're talking about ways to improve the tax system on this tax day 2019. i'd like to hear your stories this year and your thoughts on doing that. republicans, use 202-748-8001. democrats, 202-748-8000. and for all others, that line is 202-748-8002. you can also send us a tweet, @cspanwj. the report that both of you have done on the tax system, if you had to take one thing that the 2017 law does that simplifies the system the best, what would you say that is? >> the rate reductions were a vast improvement. what really drive's people is a marginal rate. so lowering the rates is fantastic and good for simplicity and&creates a

standard deduction. guest: that means fewer people are itemizing . when fewer people do that, it's just a simpler system. we keep going back to the tax law. i think a really important issue is the i.r.s.'s budget. the i.r.s. has seen a huge decrease in their budget over the last decade at every level, service, compliance, so are people being able to get through and have questions? are walk-in centers still open? those are programs available to folks, those are the real questions that a lot of folks have. and then are people paying their fair share? do they have the resources to audit high-income corporations? host: do you feel like right now we don't have the resources? guest: definitely don't. i've watched the i.r.s., did oversight in the 1980's to the senate, restructuring commission, the 1990's, they

have fewer people, much larger economy, a lot more taxpayers, but they a lot fewer people than they did even 10 years ago, like 20,000, 30,000 people. you should have probably seen a growth in the agency to maintain levels, to maintain collection levels, to provide for walk-in resources for folks, because, you know, some people, they don't mind getting on the computer, but other people, they need to go and bring their shoe box in and talk to a real person. guest: i worked for the i.r.s. in the clinton administration. and there were roughly about 100,000. today they're at 72,000. you're getting to the point where the irsirs going to do less with less. so we have to be strategic in how we do staffing. but if you want someone to answer your phone calls when you have questions, if you want to walk into a site, that requires staffing t. can't be done automatically. we have to be strategic about how we put resources in.

host: we welcome your calls and comments. republicans, 202-748-8001. for democrats, 202-748-8000. or all others, 202-748-8002. we'll go to belmont on our democrats line. lacrosse, wisconsin. go ahead. caller: ok, i was wondering why , if you have a daughter or son that's 17 years old, why you wouldn't qualify for the $2,000 tax credit, which i didn't qualify for. since they're more expensive at 17 than they're at 12 or 13. that was my question. guest: what's the cut-off age for that? i'm not sure why they do it that way. i really don't. i mean, i agree with the caller. that's all i can say about that. you know, i have college kids, and they are the most expensive. i'm not sure why a credit that's trying to help folks get their kids out of the to be

independent would stop at a young age. i think the answer is obviously resources. it's money. they're trying to save money. guest: this is where the tax becomes more complicated, the removal of permission complemmingses, trying to consolidate credits, and some horse trading had to go in. it's a long way to go, but basically they had a 10-year window to make the math work, so there's phase-ins and phase-outs. a lot of the individual provisions are going to expire at the end of 2025, and we almost go back to how things were beforehand. there's a lot of confusion that was done to make the political payoffs and numbers work in the budget system. i think to the caller's point, this got caught with the math. host: let's flare ed, republican line, new jersey. caller: hello. i have a question to make the tax code more efficient. we should move to a value added tax in addition to the income tax. did you hear me? host: we did. and tell us why you think the value added tax, tell us about

that, and why you think it would be a better system. caller: this is placed on the improvement in the value of the product as it goes through the system. and the advantage of that is there's a large amount of black market money that never gets taxed today. and it would be through the value added approach. also, for example, all the landscapers in my area are paid in cash. nd people do not pay any other taxes, nor income tax. host: the value added tax. guest: i'm a fan of the value added tax because it taxes consumption. would we want a tax? you basically want a tax that you want less of. i would love more work, more savings, more investment, and the income tax. i'd rather shift more to a

consumption tax and reduce the income tax. i'd railroad reduce the income tax and push more burden on assumption and tales tax, and the caller is right f. there are people out there who have high incomes and can afford lawyers and attorneys and find ways to shelter income from taxation, when this they go out and spend, whether they're buying houses or ferraris, they would pay tax on that. the value added tax is continued to be regressive, low income people pay a higher share. but there are ways around that, you can do a rebate for taxes paid for low income people. host: is that where the pushback comes against the value added tax? guest: it's a hidden tax. we don't see it. policy makers can increase it without folks really seeing it. my concern going back to the tax administration outlook, which is really my perspective, is that you give the i.r.s. another job to do if you would.

they're pretty decent at collecting some taxes here and there, maybe the estate tax a little, but this is something administered for many, many years, so now you tell them they're going put an entirely new system on here. and congress has a long history of giving the i.r.s. more jobs and not giving them more money to do it. so if it went along with an authorization, and then a suggested appropriations, then that money was given to the agency to hire an extra 10,000 people to administrator an entirely new tax system, which they have little or no experience in, it could be workable. but that's something to be concerned about. host: next caller. caller: i was calling because where i'm getting in trouble is from the estimated taxes -- i mean, exemptions, now i used to take my itemized deductions between $9,000 and $1,000.

then i had my exemptions, which was myself and my son, now i can't take -- around $18,000 or $19,000 deduction. now i don't get that. i can only get the 12 or do the itemized, which i can't take the exemptions, so now i'm losing about $7,000, and i actually ate $1,000 that i could deduct, i can't do it now. i have to pay this time. host: how much are you paying this year? caller: i paid $560-some more my taxes. host: in federal taxes? caller: yep, in federal taxes, because i couldn't take the $18,000 or $19,000 off, because he exemptions were gone. i had to take the standard, which is $6,000 less than i would have had on there. host: ok. guest: this is something we were talking about at the

opening of the program. to her point, i don't know her exact circumstance, but it's very likely that she had withholding that allowed her to keep more money in they are paycheck throughout the year, and that left her short. while she's doing a return now, what she sees is the standard sbucks has been increased, but she's lost the deduction she could have had before. and so she owes money now at the end of the year, but when she looks at the entire year of her tax liability, she's probably saved less f. you're still listening, what i would suggest you do is change your withholding for this year if you don't want to owe this time next year and have more money withheld. host: sheer judy, sun city, florida. caller: good morning. thank you. my question regards volunteer expenses. in prior years, i've been able to include -- itemize annually, and i've had the ability to

deduct for volunteer expenses related to military support groups. and this year i was told that available. nger i guess my concern is one, of course, i had to pay back at the end of the year. for the first time in about five years. also, i am concerned that this will reduce volunteer hours nationwide, because we have about 30,000 strong nationwide. thank you. host: judy from florida. jeffrey, any thoughts? guest: yeah, i think it's important. like this year when did i my xes, it was a commercial software, so i could see last year's, each sort of category, gross income, adjusted gross income, exemptions are gone, my deductions, i don't really see the tax rates. the tax rates are kind of

hidden on there. used to be you had a nice chart, you went along, you could actually see where you fell and that sort of stuff. but then taxes paid. and then you have to analyze the withholding and what's you're doing on that monthly or bimonthly paycheck. because there's a lot of moving pieces there. i mean, if one deduction is gone, but you're in a different rate, you're in a lower rate, and then your withholding changed because they messed with the withholding tables, it's really important to actually scomplook see what was your gross income, what was your adjusted gross income, what were your taxes actually paid. &then if you need to make adjustments, that's when you do it. host: a story earlier, maybe out of the realm of your report of the bipartisan policy center, judy talked about her volunteering, does the reduction and the ability to

itemize, will that dis incentivize volunteer efforts? guest: i think this is an important point, because a lot of things are trying to drive individual behavior. buy a house. get a fuel efficient vehicle, go volunteer. simplicity of the change in the law was designed to say the government shouldn't be trying to incentivize your behavior on this. this is not where the tax code should go from a complexity. we can argue about social policy, but let's expand the standard deduction. keep doing what you want to do, but now we're going to expand it to improve efficiency and have simplicity. the question is will it decrease volunteering? if people are looking at the tax return compared to last year and see that that standard deduction now is greater than they were itemizing , including some of the things for volunteer reductions, then they should be better off. so it shouldn't change behavior. but it was important to look at the return this year versus last year.

host: it is tax day. we're joined by jason fichtner nd jeffrey trinca. i'm sorry. jeffrey trinca, joining to us talk about improvements in the tax system. welcome your calls and comments as well. 202-748-8001 for republicans. democrats, 202-748-8000. and for all others, 202-748-8002. and reminder, too, the number of thures people are putting in in terms of doing taxes, from the sandirts latest figures on the average time it takes a person, according to the u.s., nonbusiness taxpayers, an average of seven hours and $110 filing their tax returns, an expense particularly burdensome on the working poor while free tax filing services are marketed as easy to use. the major tax filing companies such as intuit ultimately have

a vested interest in keeping taxes complicated. that's one view. we go to judy in stafford, virginia. judy, good morning, go ahead. caller: good morning. i haven't owed nacks at least seven or eight years. and i switched jobs six months ago, and they didn't take out federal taxes, and i didn't catch it. so today i'm trying to file taxes, and i've also volunteered to do taxes for people for probably 10 years. and i'm going owe $6,000. i didn't get $6,000 back with his tax cut. guest: yeah, first of all, get in quickly, because we're already well into the tax scombreer get your withholding straight. this happens quite a bit. the agency for that amount, what you can do is you can ask for an installment payment.

you need to either go on irv.gov and set that up, or you can do commercial software or if you prepare they'll help you out as well. that's my suggestion there. you look for an installment agreement. host: go ahead. guest: we have a major change in tax law, but look at the tax law and work its way through, taking individual responsibility. and to judy ace point, she didn't take out withholding, which is horrible. i'm not saying this is her fault. but the point is because withholding wasn't held, taxes now due. i think a lot of people are getting confused. everyone just assumed that the rate, withholding rate would stay the same to what they owed. so if they got a refund last year, they'd get one this year. that's not what happened. they actually did get a tax cut throughout the year, but that assumes it was withholding going on. so they get the tax filing season, and although their

federal tax liability is lower than last year, because withholding was less, they end up on that owing more at this point in time, but overall, they'll still have paid less. host: jeffrey trinca? guest: i mean, it's important to understand that the filing season is really reconciling your business with the government. it's not -- you should have been paying throughout the year. you should be looking at that, at that paycheck, and looking at that thing and saying, how many i doing here with the federal taxes, my state taxes? i have a good sense of what my effective rate should be. so when i look and say, hey, i've got a problem here. my withholding is way below what my usual effective rate is, which for me it's about 22%. it shows you i'm paying too much taxes. if i start to drop year 20, then i'm in h.r., and i'm saying, look, guys, and sometimes i adjust, i used to allowances, but often i'll say

can you do another $300 or $400 a paycheck. you need to pay attention. host: this is so important, because there's generally a there are hold, which the government says you need to have 90% of your overall federal tax liability was held by the time you reconcile. if you haven't had 90%, you owe a penalty. because tables are on off this year, the i.r.s. has reduce that had there are hold, now down to 80%. gape say it again, because i think that's one of the most important things that can help people stay out of trouble, look what your tax obligation was last year, and do 90% of it this year at least. guest: exactly right. host: do you think that people were late in kind of -- people owe taxes were late in figuring that out? guest: i think we all were late. i don't want to blame that, because i owed money this year, because is part of the withholding tables. if my wife is watching, she'll get mad, but she said i owe money, it's your fault. and i said it's not my fault,

we lowered your taxes. why do i owe money? do the math. look at what you have for the year, reconcile it. and she did get a tax cut for the entire year. but because her withholding was lower throughout the year, and she got more throughout the year, when she reconciled in april, she ended up owing money. overall she came out ahead, but she didn't like writing that check. host: back to callers. john in troy, michigan, independent line. caller: i just want to touch on something that jason was talking about earlier. we really don't have a federal income tax. the federal tax we pay is actually a personal decision and income tax. if two people making $100,000 a year, one guy decides to buy $150,000 house, and another guy decides to buy a $250,000 house , why does the guy that bought a $250,000 house pay less in federal taxes? that's not fair. that's a personal decision he

made. it has nothing to do with his income. the same thing with people who have multiple children and people who only have one child. they get a federal tax credit. they wind up getting back more than they paid in taxes. that's what it was. i'm just saying the whole system is unfair the way it's isn't, and it's set up for social engineering, more than for income. but that's my comment today. guest: shout out to the caller from troy, michigan, because i grew up in troy and birmingham. hello, caller. the caller is right. we've designed a system, trying to find ways to make it progressive. but we violate equity both horizontally, meaning taxpayers paying different amounts, and also vertically. we have people with different incomes. again, we agree, all these deductions go away, broaden the

tax base, but in return for getting rid of these, we would significantly lower rates. down to 10%, 12%, and then tax everything. host: let me talk about the poverty programs in the u.s. has complex eligibility rules requiring 20 separate determinations, including tie-breakers, didn't understanding the rules, leaving many qualifying workers to not claim the benefit or make improper claims. how do you improve that, simplify that? guest: well, it's loft attempts at doing it. jason, maybe you should take this. guest: this is very complicated. and i think in some ways it's been designed improperly, so part of the idea is it's supposed to promote work, but also help low-income people smooth out their assumption over time, basically make ends meet throughout the year. but we give it at the end of the tax season.

one way to do this it would be change it and have the payments done each paycheck. and to have some safe harbor. part of the problem is qualification. t's confusing. can you prove it? how can you prove it? how do you balance it? parted of it is simplifying the rules. people's income, the problem you have is someone who qualified last year may not qualify this year, but they think they did, so they filed it, and then they go after and owe money, and then they don't file the next time. host: we talked about the number of audit that is people getting get and was brought up in a congressional hearing. do you think that's one of the reasons causes the number of audit the i.r.s. does? guest: the i.r.s. has the information of information reporting documents. our employer reports the ages

we paid, interest paid, and that's an easy check. it's easier for the irtoirs look at that electronically, not necessarily a person to do that. so if someone made a mistake it's easy to go after them. because it's so complex, people can make a mistake. they just get confuse and had hard, so they make mistakes, and we unfortunately go after it. guest: there's two points. they always talk about the efficiency of the vitc, that it's an efficient welfare system. maybe what it is too efficient. if the agency had more money to actually help people comply, to reach out to folks, if there was more money for the program, if you had something we care about, regulation of return preparers, because they're complicit in the overpayment in this area, then you can make a system simpler. it wouldn't be as efficient, but people might be happier with it because they would have more help upfront.

host: this is the free tax help to people who make less than $25,000 this year. taxpayers who need assistance in prapping their own returns. let's hear from rich, trenton, new jersey, on our democrat line. good morning. caller: i would like to know why we still have carried interest for the billionaires and millionaires and other question is why does general motors and amazon pay zero income taxes, plus they get a tax rebate. thank you. guest: i don't know about you, jason, but i would love to get carried interest. host: what is that? guest: essentially you're converting something that looks like ordinary income into capital gains, and the capital gains is taxed at a lower rate. so you're in a partnership. i've been in a partnership for most of my adult life. and for whatever reason, the money comes out, and if i make

it, it comes to me, and i pay ordinary higher income tax rates at it. if i was in a different interest, that payment was essentially capital gains. from my perspective, it's just personal thing. agree with the caller, it's hard to really justify it. guest: jeff's right. we shouldn't fall on our swords for carried interest. you can make some economic argument that people who basically invest in a business are putting their time in a business, and so they get some equity in that, and that's a return that's capital. to jeff's point, make it simple. it f it looks like a wage, it's a wage and tacksd like a wage. and then on the amazon point, what i would point out to the caller is that only people pay taxes. corporations may have a responsibility, that burden falls on us, it falls on consumers, workers or shareholders. so i'm not concerned that amazon and g.m. aren't running a check, i'm more worried about

how it falls on the people and whether that's a proper burden. guest: amazon has had a reputation for reinvesting the money they make. i don't know this particular year, but they kind of defied their profitability. they invest in warehousing and technology and server farms, and solar powered and they're always doing research on how to make everything more efficient. i'm not an expert on their particular tax returning but i know that that is their reputation. they make their money and go right back in. that's what we want from our businesses. host: next up, wisconsin, independent line. i'm very interested in this discussion, and i was wondering what your guests would think of, just a straight sales tax on the federal level with no

exemptions, because if you put exemptions in, then you have the lobbyist involved, and that's the worst thing you can do with lobbyists in our government, i think. and also, jason said something that corporations don't pay the taxes. they're passed on to the consumer. so why lower the corporation taxes if the consumer pays it? host: let's pick occupant last question. guest: the last one, to jeff's people, we're curious about this, so business investment creates jobs, creates opportunity, because the statutory rate in the u.s. was so high, it was 35%, it was higher than our competitors, we were seeing business investment take place outside the u.s. so business was leaving, and in some plays, that took jobs with it. so what happened? it was the tax burden at that point fell on workers, not consumers. consumers still buy products because the corporations were leaving and the jobs left, now the worker bears the burden of that tax. so by lowering the torpgs tax

rate, we're hoping to encourage new companies, i went to the auto show yesterday, and toyota had half the floor space, and they are promoting. they've got four giant plants, if not more in the midwest, kentucky, and they're now an american company. that lower corporation tax rate elps keep the jobs here. guest: it is a new tax regime, if you would. a lot of the sales tax that the states would collect the money in and made it over to the feds, we've had wars over those issues. i wouldn't want to think about that. we've had issues on lower income folks having to pay a dippings proportionate amount of that. you have to figure out something on that. it does get back to an earlier

issue on the value added tax, that our corporate rate was so high, because most of our competitors have a value added tax, and the corporate sales tax is just kind of an add-on, if you would, and most of the revenues are coming from the value added tax. we've gotten -- we've lowered it to be competitive on it, but we haven't replaced it with another, so we're a trillion nd a half dollars off. guest: we fwalkt idea of making a tax code more efficient and more fair, and that also comes with complexity. i would go to a consumption tax, wouldn't start with an income tax, but now that we're so invested in the system, any transition away causes winners and losers. if we moved completely to a consumption tax, a value added tax and dropped the income tax, imagine today's retiree who is worked their entire life hanging the income tax, so at $100, they were paying, and now they get to retirement at $80, and now we tax out of consumption. they end up being the losers in

his. host: rich, good morning on the republican line. caller: interesting discussions going on. foreign bill, when the u.s. carmakers would say they were u.s. built, the foreign countries would say you're japan bashing, and now they're allowed to say that. the other thing is having an absence of form showing up, one time you could have a tax office in your area, had a wall of forms in the library, both have them. now we don't have tax office. we don't have forms. the post office does not have tax forms. the library, 10 cents a page, you can get copies. they don't even have an extension form down there setting in the desk for people. the other thing that happens is

social security taxable or not taxable, trying to figure out whether it's nontaxable, really change the amount to guess how much you owe. host: rich, quick question for you, how did you do your taxes this year? did you have an accountant, online? caller: both. and with the jumping back and forth, not even an en construction book, and even some web sites have so many paid ones that jump on you and screw up your computer with it. host: the user experience on the 2017 law, did your report address that at all in terms of simplifying that experience? guest: there is an issue about folks, should folks get on irv.gov and file for free. we've encouraged the i.r.s. to look at the universe of the free file program as sort of a

brand product. some people like to do their taxes themselves. this people like to go and have someone help them face to face. and so it really is a universe, and they need to think of it in that regard. you know, i've been a consumer of the free file program that they have for my children when they're sort of leaving college or leaving school. and i wasn't a big fan of it when they first started it, but having been a consumer, i thought, wow, this is really slick. you know, my kids just coming out of college with their first jobs. ey're able to get on irs.gov and figure out what they want to use. and no charge. other folks, they want to get their shoe box together, and they figure out, get online, and they figure out why their program is, and they go in there. so i think the ability to have more of those programs so

people don't have to travel as far, i think it's key. guest: if you look at other countries where the government as i understand a bill, here's what we think you owe, a lot of european companies do their social welfare system through government payments, but like a welfare system to the government. we do ours through the tax code. when you look at countries comparable to us, it looks like the u.s. is higher than the average when you include the welfare that's going through the tax code with earned income tax credit, all those payments help make it possible to actually shift income and help low income people. but by doing that, we've created a complexity that does not allow for return-free filing. as far as you start having deductions for children, whether or not your children is less than six months or more, you have deductions for various business compulsions, you have people who do uber. i have now the complexity about the job, deduct uber expense, the government can't figure that out for you. you need help n. some ways we'd

be better putting more money into the i.r.s. to help those people file than we would be trying to make something up online that might not be very effective. host: about 15 march points left on our discussion on ways to improve the u.s. tax system with jason fichtner of the bipartisan policy center and effrey trinca,, and two of the co-authors of the bipartisan policy center report on this tax day, looking at ways to improve the irsandirs tax day. 202-748-8001, the nobody call for republicans. democrats use 202-748-8000. and for all others, 202-748-8002. the democrats line next, illinois, jim, go ahead. caller: the question i have is on the 1040. i think it's line four. for a person who works for the ilroad, they have only one

line on there, which makes it almost impossible to have the i.r.s. understand that if you have an annuity, and you get a your tax on t of your annuity and not on your wife, there's nothing on the form that indicates that that has been done other than a number. and the problem that i've been having is the i.r.s. keeps sending me a notice saying, well, we don't understand this thing. how come it's different than what we're showing? every time they've done it, it's always been, they've been wrong. and just curious, why don't they have the form detailed nough to where it can show that do you have a reduction on your annuity. host: got you, jim and jeffrey

nodding in agreement or understanding. guest: yeah, i work for a senator with a lot of retired railroad workers. much to my chagrirnings i had to become an expert at the railroad retirement system. so this is an interesting point, so they've tried to get it done to a post card on the 1040 itself looks like half a page. and so they had to take lines off. and jason is an old i.r.s. employee will tell you, that real estate on that 1040 was some of the most important real estate in the country. if you were on there, by taking it off and sticking it elsewhere, it's really made problems for folks. this is a perfect example. i use a commercial product, and it asks, you know, i prepared a return, someone else was returned, i guess. and it asked, are you getting retirement? so somewhere in that new

system, in those schedules that go behind it, there is a box there, apparently, because you can say, you know, i am a railroad retirement, which means part of it is not taxed and it's taxed differently. but if you're trying to sit down with a paper form, i think you're going to have some problems. >> we have not made the system so complex, that the vast majority of people have to use paid preparer software, whether it's an accountant, lawyer, h&r block. do we want a system where you can no longer do your taxes on a paper form? the i.r.s. wants to process electronically. but it would be nice if you can still understand your taxes. they're so complex now, people give up, or they file and make mistakes. not because their they'ding. guest: i'm of the opinion that the paper form -- when they came out, we commented on it, a number of us commented on it and said this is a really messed up situation we have here. but then the the end i

basically said doesn't matter. it goes in electronically. if they do see, it the button at the end says print, and then they stick it in their forlede. in this case, it seems like the gentleman is looking at the paper return and probably having problems. host: jeffrey, you were tax counsel for the senator from arkansas and also the chief of staff for the congressional commission to restructure the i.r.s. in 1996 and 1997. is it time for another one of those commissions? >> right now in congress, they are. moving through a reform package for the i.r.s. think it's helpful. i think the biggest value of that is it restores confidence in the agency. then congress feels like they were properly fund the agency. they feel like they've got folks manning the phones.

when we talk about audits, i mean, most of those, if they're really audits, they're letter audits. they're essentially a person that's sitting there in mississippi and they get a letter that basically says, we have some serious questions, please prove, you know, the negative. and then you've got to put your best effort together, stick it in a large envelope, the right amount of postage on it, lick that envelope, take it down, drop it in the mailbox, and then it goes to a large service center, and then an i.r.s. employee eventually gets to it, looks at it, and says this is this isn't what we wanted. that person is just stuck. when they say 40% of them end up being justified, you know, this is what happens when you have essentially an enforcement agency doing the welfare program. they know how to do certain things right. they audit. they do collections. their reaction is, you know,

we're sending you an audit, we're sending you an audit letter, if you would, and you need to send the correct information for us to allow to you continue forward with this. and if you don't, you're stuck in the system, and it's really a pretty harsh system. host: let's flare johnstown, pennsylvania, bill on the independent line. caller: good morning. first, toyota is not going to -- second, we have a single family residence rental. we were thinking maybe this would do something for us this year. last year the profit on the whole rental for the year was like $600. but anyway, qbi didn't do anything for me. can you explain why? then i read on turbo tax where single family renlts might not even qualify for the qbi. what was that all about? thank you. host: what's he talking about,

qbi? guest: qualified business income. so, there was some things in that tax bill that simplified the internal revenue code. there were other things that added an incredible amount of complexity. it's a section 199-a is a pass-through deduction for small businesses. and this real estate applying to this qualified business income is one of the most complex, and i'm now finished with all i know about it, because maybe you've looked into it more, jason. guest: it was trying to help small businesses with a tax lower rate, for those who passed through. but also it was designed to the complexity to make sure it didn't apply to doctors, lawyers, consultants. so there's exclusions. it is very complex. i don't know whether or not the

income from the rental would be part of it. i don't think it is. but that just added to the confusion. guest: they literally came out with more guidelines right in the middle of filing season on this particular issue. you're talking about an issue that really takes planning from january forward, and they got out a large amount of guidance right around october, i believe, and then they came back out right in the middle in filing season, i think, and clarified some other aspects of this very issue. host: a related complaint from viewer twitter, basically talking about programs took time of small business, my small business my brother worked for to offer -- my brother spent a couple of days to authorize them, and none came. unemployment was 2% for the staff needed slots to justify their job. he has a picture of all the paperwork, presumably some of

the calls there. this is bill on the independent line. caller: yes, thank you. just a statement. we're both retired, my wife and i. our tax rate i understand went own. and our deductions, i guess it's brert for to us take the standard deduction that comes to about $26,000. you can't itemize anything, because, you know, to get up to that amount, now normally, then you have to pay estimated taxes. so we came out ok, but this year we didn't have to pay as much estimated taxes, but for people who are retired, what we had to do is use our income, we had some home improvement work done. so i had to take it out of -- it was a nonqualified annuity, but most of my stuff is in

i.r.a., which minimum is taxable. my income went up because of the fact that i had an annuity that we took money out of, say it was an $18,000 investment and then we took out 41, to you had to pay the difference. my wife couldn't understand it, but we had to pay $4,000 to fed and $1,000 to state. what are your thoughts on how, you know, how retired people can get some help and not get taxed like this? guest: i think the one, it's hard to say where to get help, but one of the things he pointed out is that requirement of distribution requirement, we don't have i.r.a.'s right now if you get a tax deferral while working, you owe tax and take the money out, and the government requires to you start taking distribution.

there's questions whether we should reform that to move the age back a little bit. ut that is a tax liability for the i.r.a. maybe we want them to defer it or reinvest or something else. but the government needs revenue operate. and so revenue, income needs to be tacksd. how do you plan this from a tax schedule? only thought is if you sit down with somebody and actually walk through what your expenses are, where your income is coming per year and try to better time the estimated payments, it will be less of a hit in the end of the year, but there's no magic solution. >> i think this highlights the need for competent incident return preparers. what you need to do, you need someone who can sit down with you and do planning. the tax filing system is a good time to do that, but sometimes you need to do it earlier. we have over a million paid preparers. we have enrolled agents. we have c.p.a.'s, we have

lawyers, and then the greater part of that, i think people are shocked by that. the person who cuts my hair is licensed. you know, just about every service provider i know is licensed. but your paid preparer, you got to be very careful. this planning around retirement is complex. and it always has been, and you just have to make sure you have good confidence. guest: once you retire, how do you schedule income for consumption as well as planning for taxes? host: tax preparation, the amount of time on tax preparation, the chart, one of the charts from your report on the use of preparation assistance, as the tax code grows more complex and americans become more tech aftery, tax payers are likely substituting the cost of professional tax preparers for the time they would have previously spent preparing

their own returns, according to a 2018 report published by the i.r.s., 95% returns are now prepared using software, and 89% electronically filed. let's get a couple more calls here. garland, texas, olga, hi there, democrats line. caller: yes, sir, the two gentlemen, i happen to be at a tax center in austin, texas. i had a lot of people waiting in line who were asking line who were asking for extensions. the thing about it is that the i.r.s. and our politicians need to understand that there are still people there who do not meanshe software, or the to file electronically. guest: definitely. we agree, this is what our report talks about how to increase funding.

the proper training and proper funding to help people like that. host: from new jersey, charles, go ahead on the independent line. caller: it is actually michigan. host: thank you, go ahead. caller: i am only on social security income, so i knew i could put some of my regular ira before i went into a higher tax bracket. ended up that i didn't calculate right because i still got $3000 back. how was that calculated? >and, real quick, do you think the rmd will increase to 72 years of age this year. host: what is he talking about? guest: the requirement distributions for ira, there are suggestions that we increase it to 72. i don't think it will happen this year,. maybe i am just skeptical the

congress can get something done when it comes to retirement stuff. if it did, it might have retroactive, january 1 of next year as opposed to this year. guest: i would look to see what the ways and means side past. they did have a retirement piece. i was there mostly for the i.r.s. reform package, but there was a bill that they passed. i believe there is something in there on this there we had guest: it is, but it has to go to the senate. it would start january 1 of 2020. guest: what i would say is don't bank on it. there is an old saying, hope for the best but land for the worst. that is what i would do, charles. guest: folks can go to the bipartisan website at bipartisanpolicy.org.

these are my guests from the bipartisan policy center talking with us this morning about the tax system. thank you for being here this morning. guest: thank you, and thank you to all the colors for calling in. asking, did you get more of a refund, less of a refund or any refund? if you got more of a refund, 202 748-8000, and if you own the, it is 202-748-8002. we will continue in a moment right here on washington journal. ♪ >> the only thing we have to fear is fear itself. what your country can do for you, ask what you can do

for your country. and the people who knocked these buildings down will hear all of us soon! [cheers and applause] book,cer: c-span's newest the presidents. noted historians record the country's best and worst chief executives. true stories governed by interviews with noted historians. explore other life events that shipped our leaders, challenges they faced, and the legacies may have left behind. published by public affairs, c-span's the presidents will be on the shelves april 23, but you can preorder your copy as a hardcover or e-book today at the span.org/the presidents, or wherever books are sold. announcer: once, to be was simply three giant networks and a government supported service pbs.d

then in 1979, a small network was an unusual name rolled out a big idea, let viewers decide all on their own what was important to them. c-span's "to washington policymaking for all, bringing you unfiltered content from congress and beyond. in the age of power to the people, this was true people power. in the 40 years since, the landscape has changed. there is no monolithic media, broadcasting has given way to narrowcasting, youtube stars are a thing. but the idea is more relevant today than ever. no government money supports c-span. its nonpartisan coverage of washington is funded as a public service by your cable or satellite provider. on television and online, c-span is your unfiltered view of government so you can make up your own mind. ♪ washington journal continues. 2019,today is tax day, half-hour left here in the

program. we want to ask about your experience on your 2018 returns. did you get less of a refund to thethan you thought, 748e to call is 202 you owed money, 202-748-8002, and for all others, 202-7 48-8003. following up on our previous guest in terms of things you can do in terms of power tax planning, once more, with feeling, fix your withholding. that is the headline. a column in the wall street journal writes -- autumn line, if you're upset about this year's refund or tax bill, consider changing withholding to prevent a repeat next year. a warning that many filers with smaller refunds this year are

set for even smaller ones in 2019 because treasuries' withholding changes will be in effect later this year. the average refund for this group will be $200 lower next year with no changes based on an analysis of clients. regard to clayburgh, new york and hear from john. john is getting less of a refund this year. john, go ahead. caller: year, i make the same income, i am retired on social security, my pension, and bank interest, stuff like that. the banks have literally robbed retirees. we have seen for years, they give us no interest on our money, they use it all the time. yearet, my income this hasn't changed but yet i/o $1400 owe for $200 more than i

should. host: we go to texas to caroline, who is owing the i.r.s. this year. welcome. caller: i lost my property tax credit and i ended up having to a. so this is not been. an official at all. host: last year, what was your experience in the 2017 returns prior to the effect of the new tax law, what was that like? caller: it was good, i was a what to write off a lot of things, including my a most $30,000 property tax. host: so you are in a situation where you can't claim the -- ctions that you caller: yes, i can only claim $10,000 of it. the rest, have to pay. the difference is, even donating to charity, i double and triple my donations to charities to get some credit and i still have to pay. host: what do think that

strategy for this year will be, what will you do different? caller: what will i do different? hopefully increase my charitable deductions. the new taxes, they don't benefit me at all. host: ok. carolyn in texas. had land the mercury news, the headline says -- big states fear accidents of rich taxpayers but have no sign yet. they write, new federal tax have cap on property taxes caused problems for states like california that rely heavily on property taxes, but there is no sign yet that it is making residents flee to lower tax states like nevada. from virginia, the next color is getting more of a refund than she thought to lead that sounds good. caller: hi, i have two

questions. one that is more important than the other. i need to know if it is more beneficial -- how is that going other gonna take more tax or less tax when he hit 70 ?nd half host: i wish i had the answer for you, our ex have left the. what jeffrey trinca, one of our checkinge recommended the ways and means website on details on the legislation. certainly, the irish should as well. kensington, maryland, debbie is getting a bigger refund this year. debbie, go ahead. caller: thanks for taking my call. i usually all the government, i am a self-employed person, so i am always paying back taxes.

still owe for 2017 and i just finished paying for 2015. the reason for my call and i hope to get to your experts, a friend of mine told me she had paid her taxes in eight years. she owes like a hundred thousand dollars to the federal government. her tax person told her not to worry about it, that it is not going to affect her credit, and -- waitis -- wait till to pay it up. now shoestring to pay back the state -- now she is trying to state. i am concerned that somebody pays their taxes for eight years and that doesn't affect her credit. i have to pay back taxes with interest to keep everything afloat and yet somebody else gets away scott free. host: do you know if this friend of yours, in terms of the tax person she is using, is this a -- caller: this is the cba she is using. don'tt regard her -- i

begrudge her, but i am mad at the whole system, that i struggle and put everything forward in an honest way and yet somebody else doesn't have to pay for eight years, i/o $100,000, and gets away. she has gotten time to buy a house. she doesn't even do it doesn't even affect her credit. i just find that of noxious. >> thank you for your call. we go to mark in westwood new jersey. mark. caller: thank you, good morning. i got no refund this year. i usually get a couple of thousand every year because we get the max taken out, my wife and i. we usually go on a vacation with the money you had so now we have to pay. so we basically paid thousands more, we are regular working .eople, my wife is a teacher it is ridiculous. i think the republican tax scam

was created to hurt people in the blue states like us, regular working people, hurting seniors and giving all the benefit to the wealthy and the people in states. we have high property taxes year, which i am happy to pay, because it want kids to go to school and have a good education. but now, i can't even write them off? this is ridiculous. if people keep voting republicans in and believing they will cut their taxes, we are going to keep having these problems. scott in seattle, he is getting a refund this year, more than he expected it good morning, scott. caller: good morning. the yearefund, and before, had to pay. i have been retired seven years. ?he have any questions host: you pretty much stated your case, thank you. we go to washington. kathy is owing the government to this year we had go ahead. caller: yes, i/o a little more

a taxes this year -- i owe little more in taxes, and paying more because of withholding. host: has this years experience been easier for you or harder? caller: it is the same. i had a cpa do it for me. host: where you surprise at the results this year or not? caller: i expected something strange to happen because this tax did not seem geared to help middle-class people. all the government. again, is that more than you thought you would? caller: oh, yes. i have nothing withheld, usually i get a refund. host: appreciate that. -- 202-748-8000 is a number to call.

if you all the government, the number to call is 202-748-8002, and for all others, the number to call is 202-748-8003. a headline here -- filing for an extension can pile up. . she writes, you can achieve a reprieve by filling out i.r.s. form 4868, an application for an automatic extension in time to file a u.s. individual income tax return. it gives you six extra month to file your return. she writes that nearly one in 10 taxpayers filed for an extension and most of them do it online. eric smith, a spokesperson for the i.r.s. -- "we are project over 4.6 million extension request this year." so what is the number one reason many people want an extension? "they are not prepared to pay, they knows galloway,

the extension doesn't give them time to pay. she says she has to tell people, it doesn't stop the interest or the penalty. from springdale, arkansas, cynthia, good morning. caller: good morning. i wanted to share with you that we are paying a little more this year. i think our effective tax rate has gone up considerably with the minimization of deductions. we are feeling more of a pitch this year than ever before and i am hoping congress will certainly take a more generous look at how seniors are trying to cope with navigating the tax code, especially as we start withdrawing from our iras. there seems to be a lot of confusion about how much we should take out and when. you think that confusion has gotten worse because of the 2017 tax law, or? caller: i don't know, i just think that there needs to be perhaps a more cohesive

structure for how that is going to hit people as they are withdrawing and also getting their social security payments. it seems like, you are at the heart's plan of your life any have the least amount of help. as things get more complex and your agent will. -- you are aging more of the time. i'd think that group needs the more tax exemptions that it can get. host: over the weekend, the chair of the ways and means committee released a letter to the administration to do that. some reaction to that from the sunday shows, the headline in the washington times says -- most members of congress won't understand trump's taxes. the press secretary says, the democrats request about political partnership, the press secretary would not say sunday whether president trump will order the internal revenue service not to release his tax

returns to house democrats as they renew their efforts to disclosure. the president has been clear since the beginning, as long as his taxes are under audit, he will not release them, she said on the fox news sunday. this week onon abc, talking about the discussed plan, the proposal the president immigrantssend some -- the illegal immigrants to so-called sanctuary cities. we want to play your that come and the reaction by the judiciary committee chair jerrold nadler on cnn's state of the union. first, press secretary sarah sanders. >> the president likes the idea. what we're looking to see is if there are options that make it possible and are doing it in a full and thorough and extensive review. the president likes the idea. democrats have said they want to these individuals into their communities, so let us see if it works and everybody gets a win

out of it. again, this is not the ideal. situation. simple.l solution is it is for congress, particularly democrats, to sit down with the president, do their jobs, and to help us stop this horrible crisis at the border. it can't be denied or ignored anymore. democrats, including obama's secretary for homeland security are now acknowledging that this is a crisis. they can either deal with it at the border and stop it from getting worse, or there are going to have to take on some of that burden in their communities if that becomes an option. and then come of not our first choice, but may not our second or third choice, but we need to look at all options as long as democrats refuse to do their jobs and fixed the problem. >> the president has no right to spend money appropriated by congress for other purposes to ship immigrants all over the country. if someone requests asylum, he should be considered. there should be a place for that person to stay while that asylum

request is being adjudicated. nor is it right for the immigrants orse people who are claiming political asylum as pawns in a fight against political opponents. them as what he imagines as retribution for political opponents in various areas. there is another misuse of presidential power against the law. we heard several weeks ago from whistleblowers that steve miller and probablythis, steve miller, who seems to me the boss of everybody on immigration, ought to come before congress and explained these policies. nadler,at was jerry chair of the judiciary committee, and he mentioned the presidential advisor, steve miller. in the washington post this morning -- miller's sway draws scrutiny.

they write, house democrats are sharpening their focus on white house immigration adviser, stephen miller, with key lawmakers saying that he should testify about his role in recent policy controversies. that talk of calling him a four lawmakers comes days after the washington post reported he played a key role in a plan first discussed last year to undocumented immigrants into sanctuary cities represented by president trump's democratic critics. while the plan never came to fruition because of rejections from agency officials, trump has since embraced the idea. back to taxes. your experiences this year. we go to oak hill, west virginia to ernestine. he is getting a refund this year, more than you expected. go ahead good morning. . caller: yes, i got more because i am retired, and i had more state tax and federal tax taken

out of my pay. because i am on social security, that i can live on that so that i can get more back. but this year, i got even more than i expected that i have gotten from -- it has been about $800 more than i have gotten back in the back years. but even when i was working, i had more income tax taken because i didn't want to pay that much at the end of the year. so i would recommend everybody to take more federal tax out. plus, the other thing that helps retired people and seniors in the statenia is, gives us homestead exemption for some of our taxes here. but i have always taken out more federal tax on anything that i have earned, even when i was

working. so i would suggest that to everybody. i did this even before, as i said, before the tax change last year. host: thanks for that, ernestine. from sykesville, maryland, halley is getting less this year. caller: yes. i actually got significantly less. we got half of what we normally get, and we didn't change our and we actually were in a lower tax bracket and had a lot more to write off, and we got half. becauselow financially we really needed that money, i mean, we are middle-class working people as well, and the , it day after filing taxes was listening to c-span's live coverage of the pharmaceutical companies being asked questions

about what they did with their tax breaks, and they would say, oh, well, the $7 billion really didn't go that far. so it is really quite , andrating to hear pharmaceuticals and corporations complain about the $7 billion tax rate when everyone else is struggling to make ends. host: ok. larry from ohio, getting more back on the refund this year. good morning. morning.ood thank you, c-span, i appreciate you guys doing shows like these. it was a very positive thing for me, i am a retiree. between my social security and my investment income, i actually got a very, very good amount that i had not -- because i don't have anything deducted. i actually had about $1800 less than i had to pay last year. very appreciative of the tax

program, at least for the middle income people i am involved with. my daughter had the same thing, she had a lot less than i did, but she had a nice little refund , too. very positive. . host: in terms of the process of self, simpler, easier this time around? caller: simple for me because it moved from another state a year before, so i was able to get just the one estate form. within a half hour, was working with my accountant and i was done. everything worked out fine. i thought it was very simple. host: john is next, from oe, maryland, getting more of a refund of the expected -- from bowie, maryland. caller: hello. normally i pay about 11.5% of my ,ncome for state and federal and this year, it was a .5%, so

i got a nice refund back. i am just curious, how long this might last. [laughter] host: all right, john, thanks for that. nelson in st. louis, missouri, he is going to pay the i.r.s. this year. good morning. caller: good morning. i am going to pay because of what the republicans did. they took away the personal exemption of $4500 per exemption. so i itemize every year, so even though i come up with a $20,000 in atomization, i subtracted from line 32, i would always be a what to subtract another $4500 for exemption. so they took that away, that is why i have to pay taxes. they also took away union . union dues premium for people who itemize, they can't deduct those union dues anymore, and they can't deduct the

unreimbursed employee business expense. like -- i am retired now, but i used to have to travel when i worked, and the company would reimburse me for part of my travel expense but not for the full amount. so i was able to go in and conduct the extra amount that was not reimburse for. they have taken that away. . i used to be able to take the expense of having a phone, i was phone, if theve a required you to have uniforms, to where specific shoes, you could is cost, and you can't do that anymore. host: how long have you been retired? caller: about 90 years now. host: we have a couple more calls -- caller: about nine years now. host: thank you for calling. the is a headline -- president will use tax day on monday to visit minnesota, and erstwhile aquatic stronghold

that he hopes to flip in the 2020 election after nearly winning it in 2016. to show you, the president is reportedly raising $30 million in the first quarter in his reelection campaign. they say that it is getting to a fast fundraising start, while his potential democratic rivals stockpile cash for a long and ahead.ve primary politico reports that the trump campaign end of the first quarter with 40.8 million in his bank account. it shows that trump is beginning to stockpile serious money for the eventual 2020 election. the president $30 million far outstripping the democratic contenders. large dollar machines already g to boost his campaign. that is from politico.com. fenton, getting less of

a refund and he expects. go ahead. caller: i am single, 63 years old. i have worked for the last 40 years or more. i used to get back a nice refund. i am a republican. and in the last year and a half to two years, i had to go on disability due to several medical conditions. this year i received nothing. i was not able to write off my 4000 plus interest on my home, i was not allowed to write off my personal property tax or my taxes on my home. this year, i don't understand why this is happened, but in the financial situation i have been, this has caused a problem, and i don't think this tax program is beneficial to anyone other than the rich. think you willu respond to it this year, what

will you do or what can you do differently this year to get more of a refund or make sure you don't owe in the 2019, for the 2018 returns? caller: i guess i could put more money away, but when you go from over $100,000 a year to $32,000 a year, how much can you really put away? i should have a neighbor to deduct the taxes i paid, and i was unable to deduct anything. and i have my taxes done by a cpa. host: alright, we go to fargo, north dakota. steve, getting a refund of more than he thought. good morning. caller: good morning. i wouldn't say i got a refund, i federal, ir $130,000 paid in $17,000 roughly to state in north dakota, but i recently moved from minnesota to north ikota and i am sure --

believe my taxes in minnesota would have been over $60,000 to state. so i definitely -- i had to move. i just couldn't do it. it is ridiculous. absolutely terrible. host: ok, robert in texas, getting more refund than he thought. go ahead. caller: i am getting a much bigger refund. i am not paying in social security, though, i work for a school and we have a different retirement land that we pay into. but i also had a 1099k which is apparently not that, and, but i am making a lot more money than i was the last two years. last year i made $100,000, and i had to a in, because it was in getting insurance, and i had to pay for that. this year i am not having to pay for that, so i will get a little

more of a $10,000 return this year. host: do you do your taxes online, do you use a account preparer to do that for you? caller: i use a cpa now. i used to do it online, but i have been getting more forms that i have to fill out this year eating that i have a wife now. i was single, now i have a wife. host: we will let you go, robert in texas. thanks for your call, and all the calls this morning here on washington journal. hope you get your taxes done on time if you haven't done them already. we will see you tomorrow morning at 7:00 eastern here on c-span. ♪ announcer: coming up the c-span a discussionoon,

about federal regulation of social media networks hosted by the cato institute. and president trump traveling to an economyhosting and tax policy roundtable at 2:00 p.m. eastern. later this afternoon, georgetown university host a discussion with a former federal reserve chair, janet yellen, starting at two.eastern on c-span and more road to the white house coverage with them a candidate andrew yang holding a campaign rally at the lincoln memorial in washington, d.c., live at 6:00 p.m. eastern. you can also watch these events live online at span.org or listen to them live on the free c-span radio app. tonight on the communicators, from the state of the net conference in washington, d.c., speak to daphne er