Wallet Hub - With Tax Day fast approaching, the 28% of Americans who wait until April to file their returns have a lot of catching up to do. Taxes are complex under normal circumstances, and that's only intensified when you add a time crunch to the mix. With that in mind, we've compiled a list of last-minute tax tips and reminders that will hopefully satisfy any questions that you have as well as keep you on task through mid-month.
Receiving a refund isn't always a good thing. In fact, it may indicate that you are overpaying and thereby sacrificing potential investment returns. How you approach this reality depends on how careful you wish to be in dealing with the IRS.
"Personally, as a risk-averse accountant, I instruct my employer to withhold a little more in taxes during the year than I expect to owe so that I have a 'cushion' when I file my return," says Kirsten A. Cook, professor of accounting at Texas Tech University. However, if a taxpayer receives a large tax refund, such a refund indicates that the taxpayer has made an interest-free loan to the government. Knowing this, the taxpayer may prefer to reduce paycheck withholdings and have that money available for consumption of goods and services during the year or invest that money in stocks or bonds that generate a return on the investment rather than allowing the government to use that money for free."