On The Money: Five things to watch on first Tax Day under Trump’s law | Trump lawyer disputes Dem reasons for requesting tax returns | Trump struggles to reshape Fed

Happy Monday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

See something I missed? Let me know at slane@digital-stage.thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.

Write us with tips, suggestions and news: slane@digital-stage.thehill.com, njagoda@digital-stage.thehill.com and nelis@digital-stage.thehill.com. Follow us on Twitter: @SylvanLane, @NJagoda and @NivElis.

 

THE BIG DEAL– Five things to watch on first Tax Day under Trump’s law: This year’s tax-filing season has been one of the most closely watched in years.

The filing deadline was today, Monday, in most states, and it’s the first time people are submitting returns that reflect many of the changes brought about by President Trump’s 2017 tax law.

{mosads}The filing season for tax year 2018 began just days after the end of the longest government shutdown in U.S. history, when many IRS employees were furloughed or working without pay. That 35-day standoff raised concerns about the agency’s ability to process returns that had to take into account the biggest changes to the tax code since 1986.

Here are five things to watch for the first filing season under Trump’s tax law from Naomi Jagoda.

• Refund sizes: Refunds reflect the amount that someone overpaid in taxes during the year, and in many cases people saw tax cuts in the form of bigger paychecks rather than a larger refund.
• Number of extensions requested: Many tax preparers say that more of their clients are requesting extensions this year, like owners of noncorporate businesses subject to a new deduction.
• How the IRS fared: The government shutdown that ended on Jan. 25 does not appear to have had a long-term impact on the processing of tax returns. The number of returns processed through April 5 was down 0.5 percent compared to a similar period last year.
• GOP, Democratic messaging: Trump traveled to Minnesota on Monday to tout the tax law, while Democrats have been arguing that wealthy individuals and corporations are getting bigger tax cuts than the middle class under the law.
• Filing season’s influence on public opinion: Polling related to Trump’s tax law has not been good for Republicans.

More on the tough polling for Republicans… Only 18 percent say they are paying less under Trump tax law: 

Less than one in five registered voters say they paid less in taxes during the first year of President Trump’s landmark tax law, a Hill-HarrisX poll released Monday finds.

Only 18 percent of respondents say they are paying less in federal taxes for 2018 compared to 2017 in the survey, which was taken ahead of the April 15 tax deadline.

A majority said their 2018 tax bill was about the same or higher compared to 2017. Thirty-two percent said their federal taxes were higher under the Trump tax law. A plurality of respondents, 36 percent, said they owed about the same in federal taxes compared to the previous year. Fourteen percent said they were not sure whether they paid more or less. 

More from Tax Day: Trump attacks ‘very fake’ New York Times for tax law piece: President Trump on Monday attacked The New York Times as “very fake” for publishing an article pointing out most Americans will likely receive a tax cut under his 2017 law, even though a majority say they will not.

Speaking at a Tax Day event in Minnesota, Trump held up a printed copy of the Times article and voiced his displeasure with the headline “Face It: You (Probably) Got a Tax Cut.”

“In other words, they’re really pretty upset. You can tell where they’re coming from, come on,” the president said.

Noting the article pointed out a large majority of Americans are expected to receive cuts, something that is positive for him, Trump said “they must have made a mistake. I’m sure these writers will be fired very shortly.”

 

LEADING THE DAY

Trump lawyer disputes Dem rationale for requesting tax returns: An attorney for President Trump wrote to the Treasury Department on Monday to push back against Democrats seeking to obtain the president’s tax returns, saying the request by a top lawmaker is not for any legislative purpose.

William Consovoy, who is representing Trump in the tax fight with Democrats, wrote to the general counsel of the Treasury to refute House Ways and Means Committee Chairman Richard Neal’s (D-Mass.) argument from two days earlier that the panel is authorized by law to see a copy of the president’s returns from 2013 to 2018.

“That it is limited to a single President, seeks tax information from before the President took office, asks no questions about IRS policy, and does not even wait for the IRS to finish its ongoing examinations (and any resulting appeals) reveals that Chairman Neal’s request is nothing more than an attempt to exercise constitutional authority that Congress does not possess,” Consovoy wrote in a letter to Brent McIntosh, general counsel at the Treasury Department. The Hill’s Brett Samuels has it here.

The background: Neal on Saturday set a new date for the IRS to turn over six years’ worth of Trump’s business and personal returns after the agency missed the initial deadline.

In his own letter to McIntosh on Saturday, Neal wrote that concerns about his request “lack merit” and that he expects a response from the IRS by 5 p.m. on April 23.

  

Trump struggles to reshape Fed: President Trump is struggling to win his fight to reshape the Federal Reserve with Republicans rebelling over a potential nominee and the bank’s chairman resisting calls to cut interest rates.

The independent central bank has long been a popular target for the president who has hammered it over its policies.

Trump claimed in a Sunday tweet that the stock market would be “up 5000 to 10,000 additional points” and GDP would be “well over” 4 percent.

“If the Fed had done its job properly, which it has not, the Stock Market would have been up 5000 to 10,000 additional points, and GDP would have been well over 4% instead of 3%… with almost no inflation. Quantitative tightening was a killer, should have done the exact opposite!” he tweeted.

But despite Trump’s persistent criticism, his efforts to shake up the bank and influence its decisions have fallen short.

Four Republican senators last week announced they would reject Herman Cain if Trump appointed him to the Federal Reserve’s Board of Governors, a move the president floated last week. Cain is now reportedly weighing withdrawing his name from consideration.

It’s only the latest blow to Trump, marking the third time his own party has derailed one of his picks for the central bank. I’ve got more on Trump’s war on the Fed here.

About Trump’s other Fed nominee: More than 100 economists and conservative activists on Monday endorsed President Trump’s pending nomination of Stephen Moore to the Federal Reserve Board.

In a one-sentence statement, 105 professors, former government officials and analysts, many with deep ties to conservative circles, said they “support Steve Moore’s nomination to the Board of Governors of the Federal Reserve.” 

The signatories include prominent conservatives like economist Arthur Laffer, Forbes Editor-in-Chief Steve Forbes, former Fed Vice Chairman Manley Johnson and former President of the Federal Reserve of Atlanta Bill Ford.

The statement of support comes as Moore, a former Trump campaign adviser and prolific economic commentator, faces intense scrutiny and criticism from across the political spectrum.

I’ve got more on what it means for Moore here. 

  

GOOD TO KNOW

• The congressional debate over how much to increase federal spending will soon put a spotlight on Senate Republicans, following weeks of infighting among House Democrats.
• Sen. Cory Booker (N.J.), a 2020 Democratic presidential candidate, on Monday proposed a broad expansion of the earned income tax credit (EITC), which benefits low- and middle-income workers.
• Sen. Amy Klobuchar (D-Minn.) has released her 2018 tax return ahead of President Trump’s visit to her home state.
• “China is considering a U.S. request to shift some tariffs on key agricultural goods to other products so the Trump administration can sell any eventual trade deal as a win for farmers ahead of the 2020 election,” according to Bloomberg News.
• Russian aluminum giant Rusal, once threatened by U.S. sanctions, plans to invest $200 million in a Kentucky aluminum plant that would be the largest of its kind built in the U.S. in nearly four decades, according to MarketWatch.
• Employees of the AFL-CIO, the union federation representing 12.5 million workers, could soon be facing furloughs, according to the Huffington Post.

 

ODDS AND ENDS

• Influential free market and conservative groups are pushing back against Republican lawmakers’ calls to rein in big tech companies over allegations of bias.
• Newspapers on Monday were awarded Pulitzer Prizes for their investigations into President Trump.