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Im expecting around 2500-3k. So much negativity around giving the government a tax free loan. Where I agree I could have made 15 bucks or so in interest over the course of the year if I put that money away in savings. But the key word is IF. I dont want to get use to that extra money on my paycheck and have it not go to savings. Almost every year I would use the tax money for a vacation or something special, this year 90%of it will be going in the bank.
I'm glad to see so many people get the zero-refund idea. I always feel like I'm banging my head against the wall explaining it to my friends at work!
In truth, I always try to show a minimal refund just because I'd rather have that than pay even though I know it would make the most economic/frugal sense to pay all the tax owed at midnight on 4/15!
My husband takes the max deduction just in case but we have tons of deductions so we will get a refund, usually do. We usually get it in November which is one of our slowest "money in" months.
I'd rather not say how much we are expecting. We plan to pay some bills and put some up for the kid's college fund. Almost half will go to the college fund. The rest will get us out of debt. This is a break from my old tradition. I use to save it every year and spend it throughout the whole year when money got tight or when we wanted to take a road trip. We were never broke that way.
I'm getting some back and it'll go into the savings account to help pay monthly bills while I'm on unemployment and to pay my husband's tuition for the summer and fall semesters. Hopefully though he gets a couple of the scholarships he applied for to help stretch our dollars.
$0. I end up paying because I don't have enough withheld. I never understood why people want to give the government a free loan each year.
Well, it's not as if there's really a choice on this "free loan" to the government. If you underwithhold throughout the year, you get slapped in the fanny with penalties. Don't pay estimated taxes quarterly (and so so per quarter, not all at once) on your phantom cash income? You get more fines and the threat of jail. It's no free loan, the government wants its money when you earn it, not on the 15 of April as most people think.
That said, yes, exaggerated overwitholdings to avoid said scenario is probably unnecessary.
Quote:
Originally Posted by snad5393
In truth, I always try to show a minimal refund just because I'd rather have that than pay even though I know it would make the most economic/frugal sense to pay all the tax owed at midnight on 4/15!
And that's the thing, the IRS won't let you do that. So there's no frugal about it, taxes are due when you earn them, the man wants its money now, 'free loan' is money above and beyond the taxes that are due the day you earn your money. The rest is sunk cost. I find the opportunity cost of erring a notch above break even on a tax return more suitable than quibbling with the IRS over a couple dozen bucks in interest that will get swallowed in potential penalties because I was trying to play 'chemistry set' with my W-4 and eek out net zero on the withholdings.
If I could just show up and cut a check to the man on April 15th, heck yeah I'd go for that in a heartbeat. Alas, the man knows how bad his people are with money management. Think about it, a system that encourages its populace to consume more than they make is all of a sudden gonna be kosher with allowing you to pay taxes at the end of a tax year? LOL with what money!?!? They know you're broke, they're the ones who sold you the (IN < OUT) = OK. The govt talks out of both sides of their mouth but they ain't THAT stupid.
Well, it's not as if there's really a choice on this "free loan" to the government. If you underwithhold throughout the year, you get slapped in the fanny with penalties. Don't pay estimated taxes quarterly (and so so per quarter, not all at once) on your phantom cash income? You get more fines and the threat of jail. It's no free loan, the government wants its money when you earn it, not on the 15 of April as most people think.....
Goodness. The IRS has, for decades, published the tables on how to figure out withholding so you don't pay too much. This isn't rocket science.
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Tax Refund
