Spring Overview

Turkey Prices Up Only 17% Over Past Ten Years – Consumer Trends

As the holidays approach, turkey will once again be the favored bird for millions of Americans. The National Turkey Federation estimates that about 46 million turkeys are consumed each Thanksgiving.

Turkey, relative to other items in the grocery store, has remained relatively inexpensive over the years, having risen by roughly 17% over the past decade.

Sources: BLS; CPI-Average Price Data

IRS Withholdings

OPEC Weakens Further – Oil Industry Focus

The once almighty oil cartel known as OPEC (Organization of the Petroleum Exporting Countries), has weaken to the point that its members have lost confidence in the organization’s ability to manage and control oil prices as it has done for decades. Recent political events for certain OPEC members have further hindered OPEC with sanctions on Iran and the demise of Venezuela’s oil industry.

Descent among the organization has enticed Saudi Arabia and other members to seek alternative arrangements. Discussions among a 10 nation group, including Russia but not Iran, was a consideration reviewed in February.

OPEC was established in 1960 with an initial group of 14 oil producing nations. As of September 2018, OPEC’s member countries account for 44 percent of global oil production and over 81 percent of the world’s proven oil reserves. Because of it’s cartel structure, OPEC has been the primary influence on global oil prices and supply for decades, until now. Over the past few years, the onslaught of non-OPEC producers such as U.S. shale oil production, has hindered OPEC’s supply and price control of the global oil markets, hampering its global influence on the industry.

The U.S. Energy Information Administration (EIA) tracks and projects OPEC production with the intent of identifying erratic changes in oil prices. For 2019, the EIA estimates that OPEC production will fall by 1 million barrels per day compared to 2018 daily production. The EIA is concurrently estimating an increase of U.S. production of over 2 million barrels per day. OPEC’s 14 nation members currently produce an average of 30 million barrels per day, while U.S. daily production is exceeding 11 million barrels.

Sources: opec.org, EIA; Crude Oil Production, OPEC Total, Quarterly

IRS Waives Penalty For Not Withholding Enough – Tax Planning

The Tax Cuts and Jobs Act which was enacted in December 2017, brought about a host of changes for taxpayers. Among the changes was the amount of withholdings as calculated by revised tax tables.

The IRS announced that it is waiving the estimated tax penalty for various taxpayers whose 2018 federal income withholding and estimated tax payments fell short of total taxes owed.

The penalty will be waived for those taxpayers that have at least paid 85 percent of their total tax liability through withholdings and quarterly payments.

When the revised tax brackets were released under the new tax plan, many taxpayers calculated lower withholdings assuming less taxes owed. But the problem that arose was that other factors such as dependency exemptions and itemized deductions didn’t factor into the revised withholding tables.

Source: IRS; www.irs.gov/newsroom/