Announcement

Collapse
No announcement yet.

Companies using lower tax refunds in advertising

Collapse
X
  • Filter
  • Time
  • Show
Clear All
new posts

    Companies using lower tax refunds in advertising

    I got an email from Quicken Loans (our mortgage lender) today. The subject line was "Make up for a smaller tax refund". They were promoting cash-out refinancing: "If your tax refund was less than you hoped, you could turn the extra value in your home into cash with a cash-out refinance."

    I'm certainly not surprised that a company would do this. I actually thought it was smart of them to use the tax changes as a marketing tool. Obviously, people shouldn't be getting big refunds and shouldn't be counting on those big refunds to pay for things but so many people do that and have been stuck this year as a result of getting much smaller refunds than expected. As I posted elsewhere, we actually owe money this year when we have always gotten a modest refund in the past. We can certainly afford it, but a lot of people are getting a nasty surprise when they have their taxes done if they were counting on getting money back, and even worse if they owe and don't have any savings to pay the bill.
    Steve

    * Despite the high cost of living, it remains very popular.
    * Why should I pay for my daughter's education when she already knows everything?
    * There are no shortcuts to anywhere worth going.

    #2
    Oh, I'd feel bad if I had to borrow to pay my taxes. That is the kind of thing that would feel like a threat to my survival. I imagine people this year caught in the position of owing taxes without having savings could feel angry. That's not the way my emotions would go, but for some, I'm sure it is. All the more reason to pay attention to things that affect our money, to save, and to think ahead.
    "There is some ontological doubt as to whether it may even be possible in principle to nail down these things in the universe we're given to study." --text msg from my kid

    "It is easier to build strong children than to repair broken men." --Frederick Douglass

    Comment


      #3
      Refunds are really the wrong discussion regarding taxes. I posted that we are getting a refund, but we have not received one in several years. Basically, I ended up taking the AOTC for one of our daughter's that originally I thought we would not. Our withholding was too much for the actually tax liability. The key for people is to understand how income, deductions, credits and withholding all work for their situation and manage those to minimize the amount owed as well as a large refund. While I dislike that companies are marketing to those who don't understand, I do not blame them for trying to boost their revenue. It's really up to us as individuals to care the most about our financial situation.
      My other blog is Your Organized Friend.

      Comment


        #4
        Most people haven't the slightest clue as to how taxes are calculated nor how they are paid. A "refund" is viewed as a charitable gesture by the gubmit. A sort of "lottery" prize.

        Recently, I had an employee refused a $1 per hour raise because "it is going to throw me into a higher tax bracket." You can't fix stupid.
        How can you have any pudding if you don't eat your meat?

        Comment


          #5
          Originally posted by creditcardfree View Post
          The key for people is to understand how income, deductions, credits and withholding all work for their situation and manage those to minimize the amount owed as well as a large refund.
          While I agree, to be fair that's really not so simple to do. Our tax system is so insanely complex that even the professionals have trouble keeping track of everything, plus things are constantly changing. Every year there are studies done showing the error rate of professional tax preparers and even the IRS help line often gives out incorrect advice. Honestly, I don't know that anybody truly understands the tax system entirely including the people responsible for administering it.
          Steve

          * Despite the high cost of living, it remains very popular.
          * Why should I pay for my daughter's education when she already knows everything?
          * There are no shortcuts to anywhere worth going.

          Comment


            #6
            Originally posted by TexasHusker View Post
            Recently, I had an employee refused a $1 per hour raise because "it is going to throw me into a higher tax bracket." You can't fix stupid.
            This drives me nuts. Back when I was a resident, my peers used to turn down moonlighting jobs because they didn't want to get into a higher tax bracket. These were jobs paying us $50/hour (or more) back in 1992 when that was a ton of money. I happily took every extra shift I could manage and was glad to pay whatever taxes that entailed.
            Steve

            * Despite the high cost of living, it remains very popular.
            * Why should I pay for my daughter's education when she already knows everything?
            * There are no shortcuts to anywhere worth going.

            Comment


              #7
              Coworkers complain daily about a lesser tax refund this year....well duh...if the tax rate was cut and you're being withheld less (MORE money in your paycheck) you'll get less of a refund.

              I always try to break even at tax time, this year we got a refund due to the increase in the child tax credit I'd guess.
              Gunga galunga...gunga -- gunga galunga.

              Comment


                #8
                Originally posted by disneysteve View Post
                While I agree, to be fair that's really not so simple to do. Our tax system is so insanely complex that even the professionals have trouble keeping track of everything, plus things are constantly changing. Every year there are studies done showing the error rate of professional tax preparers and even the IRS help line often gives out incorrect advice. Honestly, I don't know that anybody truly understands the tax system entirely including the people responsible for administering it.
                A majority of Americans have simple returns. I agree that the more investments you have or income that fluctuates it is going to be harder. But it is possible for a majority of Americans, and likely even more so with the new higher standard deduction.
                My other blog is Your Organized Friend.

                Comment


                  #9
                  Originally posted by creditcardfree View Post

                  A majority of Americans have simple returns.
                  That's an interesting point. I never really think that because that's not the world I live in. Pretty much everyone I know has property and kids and investments and businesses and medical bills and all of the other things that make taxes complicated. I guess if you have a standard 40-hour/week job and not much else, filing taxes probably is pretty simple. I wonder what percentage of the population actually falls into that demographic.

                  Steve

                  * Despite the high cost of living, it remains very popular.
                  * Why should I pay for my daughter's education when she already knows everything?
                  * There are no shortcuts to anywhere worth going.

                  Comment


                    #10
                    Originally posted by disneysteve View Post
                    That's an interesting point. I never really think that because that's not the world I live in. Pretty much everyone I know has property and kids and investments and businesses and medical bills and all of the other things that make taxes complicated. I guess if you have a standard 40-hour/week job and not much else, filing taxes probably is pretty simple. I wonder what percentage of the population actually falls into that demographic.
                    According to AARP around 30% of filers itemize
                    Brian

                    Comment


                      #11
                      Originally posted by bjl584 View Post

                      According to AARP around 30% of filers itemize
                      Itemizing deductions isn't the only thing that complicates taxes, though it's certainly a biggie. Also, having varied income sources, self-employment, kids, investments, retirement accounts, business ownership, depreciation, etc.
                      Steve

                      * Despite the high cost of living, it remains very popular.
                      * Why should I pay for my daughter's education when she already knows everything?
                      * There are no shortcuts to anywhere worth going.

                      Comment


                        #12
                        Originally posted by disneysteve View Post

                        Itemizing deductions isn't the only thing that complicates taxes, though it's certainly a biggie. Also, having varied income sources, self-employment, kids, investments, retirement accounts, business ownership, depreciation, etc.
                        most don't have that. Plus the standard deduction has been increased in an effort to capture a BUNCH more people.
                        How can you have any pudding if you don't eat your meat?

                        Comment

                        Working...
                        X