2. Early Filers Average Larger Refunds
Many people erroneously believe that a tax refund equals free money. Actually, it’s far from it. It’s just money that Uncle Sam has been holding on to and now is ready to pay back… without interest, of course, but we’re not here to discuss the unfairness of that little aspect…
So knowing that, how could early filers get bigger tax refunds? Data shows that people who file as early as February get larger refunds, about $400 on average. No, they’re not playing with the system. One reason for this might be because they have more time to research all the tax credits and tax deductions that they’re eligible for. Without a looming deadline, you might find that claiming the standard deduction isn’t really doing you any favors.
But here’s the thing, you shouldn’t necessarily look forward to getting a big tax refund. All in all, what this means is that something, somewhere along the lines got messed up and you’re being owed money back. In that case, you should talk to your HR department to adjust withholdings on your W-2, meaning you’ll get larger paychecks instead of a big chunk of money every year.
Additionally, talk to a tax specialist to find out where you’re getting your tax filing wrong so you can avoid ‘lending’ Uncle Sam for a whole year without any interest. Trust us, that money is better suited in your pockets!
