Government Continues to Lose Money
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Length: approx. 1 min. 40 sec.
The United States federal government collected $776 billion in taxes this past April 15th. Despite this increase in revenue, a strong economy, and a low unemployment rate, the government is set to lose “more than $1.5 trillion” by the end of the fiscal year. How is this possible?
Even with almost $800 billion in taxes collected from Americans this last Tax Day, government spending “outpaced tax receipts by $855 billion”. When compared to last year’s deficit, Washington is technically doing better. At this point in 2023, 7 months into the government’s fiscal year, the deficit was 8% wider. However, the disparity has highlighted a persistent issue: the government simply cannot get a handle on its spending.
Even though tax breaks have saved large corporations and middle-class taxpayers thousands of dollars on their tax returns, tax receipts actually increased by 22% for 2024’s April 15th. Legislation that pushed these tax breaks “have added $10 trillion to the national debt”. The Tax Cuts and Jobs Act of 2017 is particularly on the mind of lawmakers and constituents alike, as several tax-saving provisions are set to expire in 2025. Read more about the consequences of expiring TCJA provisions in our previous blog post. However, extending tax-saving provisions would add even more to the deficit, so potential solutions will likely be a hot topic in the coming year.
Business owners navigating the government’s recent shortcomings should stay aware of the latest developments in federal spending and keep them in mind for their business plan. Better yet, prepare for potential changes to tax laws by regularly checking in with a CPA personally acquainted with your business. Our team at XQ CPA would be happy to help you, so give us a call or make an appointment online today.
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