Tax REFUND, not tax RETURN

[disneysteve]

Ok, this is just a financial pet peeve of mine. If you do your taxes and have an overpayment, the money you get back is called a TAX REFUND. It is not called a tax return. The tax return is the form you filed, your 1040.

Sorry to vent but I know all the tax threads will be starting soon and this term will be misused frequently.

[Ima saver]

I never thought of that, I always call it a tax refund.

[LivingAlmostLarge]

sigh, can i put my hat in the huge tax refund this year $4k from the feds and more from the state! I am really stupid, this year our income is much different from last year, so I blame that and having income. stupid stupid stupid.

Oh and last year I owed big time.

[lrjohnson]

My peeve is when people call the EITC a "refund." I don't have a problem with the Earned Income Tax Credit, but it is not a "refund" on overpayment of taxes.

[poundwise]

I would also add that it is similarly annoying to have people bragging about their large refund. All that means is that you paid too much to start with and lost out on earning interest on your money, at the least. Nothing to be proud of. I also note that most of these people view their refund as 'free money' and promptly blow it.

[PRICEPLUS]

Better to overpay Uncle Sam than to underpay. The IRS has ways of making life complicated.

[poundwise]

Originally Posted by PRICEPLUS

Better to overpay Uncle Sam than to underpay. The IRS has ways of making life complicated.

Agreed, but it is best to get a small refund. Many people seem to revel in getting the largest refund, as if they've won a prize.

[MonkeyMama]

Originally Posted by poundwise

I would also add that it is similarly annoying to have people bragging about their large refund. All that means is that you paid too much to start with and lost out on earning interest on your money, at the least. Nothing to be proud of. I also note that most of these people view their refund as 'free money' and promptly blow it.

Amen.

My peeve is asking people what their tax rate is or their tax and all anyone knows is their refund. I cringe when I know many people getting $10k refunds - that is just ridiculous...

If I want to be a popular accountant all I have to do is make my clients up all their withholdings. They LOVE refunds - doesn't matter how rich or poor, as long as they get a refund they are happy. It boggles the mind. Well if all you want is a refund, the bigger the better, I can arrange way too much withholding - hehe.

[disneysteve]

Originally Posted by MonkeyMama

They LOVE refunds - doesn't matter how rich or poor, as long as they get a refund they are happy.

Not only that, but people are thrilled to pay 200% interest or more to get an "instant refund" loan rather than waiting 2 weeks to get it the usual way.

[LivingAlmostLarge]

BUT some people who have many kids and low income get paid by the federal government to have kids and they don't pay anything. I read on another board more if you make $50k and have 2+ kids you will get money back. Yeah, so not everyone wants a refund but gets one anyway. Because they can't get the child credit until they file. As another poster mentioned like 10 kids and $60k. they make like $5-6k/year.

[MonkeyMama]

Originally Posted by disneysteve

Not only that, but people are thrilled to pay 200% interest or more to get an "instant refund" loan rather than waiting 2 weeks to get it the usual way.

Oh yeah - that too!!!!!

[MonkeyMama]

Originally Posted by LivingAlmostLarge

BUT some people who have many kids and low income get paid by the federal government to have kids and they don't pay anything. I read on another board more if you make $50k and have 2+ kids you will get money back. Yeah, so not everyone wants a refund but gets one anyway. Because they can't get the child credit until they file. As another poster mentioned like 10 kids and $60k. they make like $5-6k/year.

The cost of raising children far outweighs any tax benefit, if you ask me.

I got paid $500 by the government last year for having 2 kids and working less hours (maternity leave - $45k income). DO you think the $2k child tax credit and the other $1k in taxes I save on their personal exemptions even come close to the cost to raise them????? Their health insurance alone is over $5/year. Dh staying home to watch them - lose $40k/year. Or he could have kept it and daycare would be $24k/year.

Should the government be paying a refundable child credit? Arguable since the government is running such a huge deficit. But I wouldn't worry too much about people having kids just for tax breaks - it doesn't even begin to cover the costs to raise a child. Daycare and diapers and such may go down as they grow older, but then they eat more and grow more, and need schooling, etc. It is a pretty pricey endeavor.

Plus if you do not own a home there is no way you can make $50k with 2 kids and get a refundable child tax credit(get back more than you paid). There is more to the picture here - a big mortgage deduction is a bigger factor in reducing taxable income. Between our mortgage and 2 kids we pay little in income taxes at $60k+.

The government does not cut a break for the single renters - that is for sure. Out of luck - I sympathize with you on that. But just shedding more light on the issue. It is not as simple as people having babies to get more money from the government. If they are, they are pretty short-sighted.

[tinapbeana]

Originally Posted by MonkeyMama

The government does not cut a break for the single renters - that is for sure. Out of luck - I sympathize with you on that. But just shedding more light on the issue. It is not as simple as people having babies to get more money from the government. If they are, they are pretty short-sighted.

hehehe!!! no kids and recently a renter here, and i've never been able to claim anything other than the standard deduction. the 'unused uterus tax' i've heard it called *grin*

[LivingAlmostLarge]

Nah, but I know someone in Ohio who makes $60 with 3 kids and doesn't pay. And someone who makes $60k in Maine with 10 and gets a huge refund. Go figure, I don't want that many kids, but they seem to like the cash from the government. I had no idea people could get money from taxes back without paying a penny. Just seemed weird. BUT it could be a reason why some people get back HUGE returns because they are getting child credit. At least on another board, that's why a lady gets a huge return. Nothing taken out but the kid credts come back to her.

And monkeymama, don't sound so bitter about SAHD. I didn't make that choice, but I am explaining how some people get huge tax returns. They don't want a large return, but the can't exactly go telling the government "I know I'll get a large refund can you put more in my paycheck???"

[MonkeyMama]

I am not bitter - just pointing out how it is anything but cheap - hehe. Blessed he does not have to work - for sure!!!!

[nanamom]

I am hoping to just get enough back to pay off what we owe the IRS from 2004. We didn't realize we had a problem until a couple months ago. Any "extra" will go to the medical bills from Jan 2006. We had to have them start taking out more starting this month so our monthly take home is less.

[PRICEPLUS]

Originally Posted by poundwise

Agreed, but it is best to get a small refund. Many people seem to revel in getting the largest refund, as if they've won a prize.

I agree with you 100% Poundwise.

[boefixepa]

What I don't understand is the state of mind. I've had this conversation with the people at work time and time again and I still just shake my head. They want that return and they know they are giving the government a tax free loan, but they don't care. It's like a savings account to them, they know they'd never have the self control to save the money themselves....???? Come on people!

[disneysteve]

Originally Posted by boefixepa

They want that return and they know they are giving the government a tax free loan

Please read the original post .

I agree completely. Millions of people think a tax refund is the greatest thing, like the government is giving them free money. And what do they do when they get it? They spend it all, usually on frivolous stuff or creature comforts. If they are so bad at saving money, maybe they should take their annual refund and invest it somewhere, like in a Roth account. Then they couldn't get to it.

[boefixepa]

LOL - you caught it! and fast! I did it on purpose just to see who was paying attention!