It’s your money, don’t give it away to Uncle Sam.
What’s wrong with my tax refund?
Receiving a refund may seem like hitting the jackpot at a time when you need it most, but taxpayer beware. A tax refund is not necessarily a good thing.
When you identify your tax withholding through your employer, you tell the IRS the amount of taxes to be withheld from each paycheck. Withholding too much could result in money owed to the IRS at tax time, but selecting too little essentially leaves money on the IRS’s table. This is the money they turn around and hand you in the form of a tax refund.
What does this mean for the everyday taxpayer? Your tax refund is costing you money. If you receive a refund, it means you have opted to receive less money each pay period.
The IRS loves to keep your money. In fact, they pocketed $1.2 billion last year, because taxpayers overpaid.
“But at least I don’t owe the IRS!” True, but your handing the IRS an interest free loan and putting them in control of your finances.
Your money, your terms. Here’s how to make sure you receive your money all year long without owing in the end:
- Optimize your W-4. Do your homework, complete the worksheets that accompany the W-4, then reduce your withholdings. Remember to submit the forms to your employers as soon as possible, because withholding takes place year-round.
- Check out our video that describes how you can use your pay stub and last year’s tax return to do the calculation on your own.
- Visit with our team. We’ll hash out the details on your behalf—increasing your take home pay and ensuring that you don’t owe the IRS at tax time.
