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How about THIS question:
Do you like to OWE -- or do you like getting a SMALL refund, or a BIG one? -- even though a big refund means you overpaid during the year.
Are you a bigger paycheck during the year kind of person? -- or do you use the tax refund as a savings option -- to get a big check in one lump sum?
I used to try to owe them a LITTLE BIT -- like less than 100.00. Then psychologically it started to bother me even to send them 50.00. The principle of it, that I was mailing in money when everyone else was getting thousands in refunds played with my mind I just didn't want to send in another red cent than they already got out of me
So for a few years now I've had it so I owe about 100.00 on one, and get about 1000.00 back on another. And that works for me.
It's enough so I feel like I'm getting a refund, but not so much that I feel like my paycheck is so much smaller than it should be, or that I'm just GIVING them money to waste during the year.
I must admit, I liked getting a BIG refund. I mean, with a refund of 3-4-thousand dollars -- I actually felt like I could do something with that as a lump sum....pay a bill off, pay for a trip, spend half AND save half. Versus 100.00 or less per pay check that seems to not be put to as good a use..it's more likely to just 'be spent'....although I do have dedicated savings.
I used to do that, then it started to play with my mind? I know it shouldn't have. But seeing everyone else getting a refund when I was writing a check -- just BOTHERED ME!) And I know I had my money all year -- but THAT was gone -- and they were still going to get their's.
I'm still trying to think of a way to have the big refund and big pay check!
(My brother says do a small home-based biz on the side, for the write-offs.)
For right now, owing a little on one, and getting a bit on another, seems to give me the best of both worlds.
I used to do that, then it started to play with my mind? I know it shouldn't have. But seeing everyone else getting a refund when I was writing a check -- just BOTHERED ME!) And I know I had my money all year -- but THAT was gone -- and they were still going to get their's.
I'm still trying to think of a way to have the big refund and big pay check!
(My brother says do a small home-based biz on the side, for the write-offs.)
For right now, owing a little on one, and getting a bit on another, seems to give me the best of both worlds.
Owing as much as you can (without hitting the penalty limit), is the way to go, fiscally. "A tax delayed is tax not paid".
I can earn investment return on the money that otherwise would just be sitting in the IRS....
Do the math.
Owing as much as you can (without hitting the penalty limit), is the way to go, fiscally. "A tax delayed is tax not paid".
I can earn investment return on the money that otherwise would just be sitting in the IRS....
Do the math.
JMHO.
That is also MY opinion, and that of my husband.
Why let the government keep your money for a year when it can be put to use by YOU!
For convenience, ideally they would owe me $2 or so. When I hear someone excited about a huge tax refund, I realize there is a part of the overall fiscal puzzle they simply are not understanding.
I do to. Those checks are used to make an extra payment or two on the house or the car which saves me more money in the long run then I would have had if it's in an interest bearing account.
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