Do you use your tax refund to cruise.

[Warm Breezes]

Of course the interest forfeited by overpaying federal taxes is minuscule, but a substantial number of the 80% of taxpayers who get refunds must be among the 40% of Americans who carry credit card debt. This is an interesting anomaly.

 

How do you know that a substantial amount of that 80% who overpay aren't among the 60% that don't carry credit card debt? The argument could be made that those who carry credit card debt also pay as little in taxes as possible so they have more in take home pay and end up owing the government at the end of the year like they do the credit card company. I'm not saying they do since I don't have the actual statistics, but without the facts the argument could be made. You like making unsubstantiated assumptions about those who overpay.....

[navybankerteacher]

How do you know that a substantial amount of that 80% who overpay aren't among the 60% that don't carry credit card debt? The argument could be made that those who carry credit card debt also pay as little in taxes as possible so they have more in take home pay and end up owing the government at the end of the year like they do the credit card company. I'm not saying they do since I don't have the actual statistics, but without the facts the argument could be made. You like making unsubstantiated assumptions about those who overpay.....

 

Non-sequitur.

[h_blond2]

I don't depend on my refund to pay for my cruise, but it just so happens that I got enough back this year to pay for it. I was going on the cruise regardless of how much I got back, so I just think of this as a bonus. I usually have to pay in a little, so it was nice to get some back this year! It's really no one else's business what you do with your refund!

[momofmeg]

Really?

 

Yes, as we do everything we can to not get a tax refund but have as much cash now. We do itemize eon our taxes and every year our refund is less and less, as we will have our house paid off in 10 years or less, so we have less interest to claim. That is okay I would rather pay more taxes on April 15 and have my home paid off. the good thing is my county gives us a tax break on property taxes at age 62-so even if we pay a bit more to Uncle Sam, at least that will be less.

[momofmeg]

It's one of the reasons we are in no rush to pay off our home. We are making more on our investments than what we are paying in interest, and other than donations and business use of the home credits, the mortgage interest is our only deduction. I suspect that after we retire we will end up paying every year.

 

Hubby does have investments, we just have made it a goal to have our home paid off before he retires. But then like Dolittle our home is modest. Instead of continuing to buy a larger home as our income increased, we are satisfied with our 2000 square foot home. Heck, it is more than I could keep clean. Any larger and I would need maid service.

[navybankerteacher]

Yes, as we do everything we can to not get a tax refund but have as much cash now. We do itemize eon our taxes and every year our refund is less and less, as we will have our house paid off in 10 years or less, so we have less interest to claim. That is okay I would rather pay more taxes on April 15 and have my home paid off. the good thing is my county gives us a tax break on property taxes at age 62-so even if we pay a bit more to Uncle Sam, at least that will be less.

 

It tends to work out - at roughly age 65 income drops substantially, and at least a good portion of Social Security income is untaxed, so the loss of a major deduction like mortgage interest is offset by a reduction in taxable income - hopefully matched by a decrease in day to day expenses like commuting to work and other work-related costs.

[Gloria Mundi]

I used to work with another actuary- smart guy, well-paid- who always looked forward to getting a refund each year so he could spend it on some splurge like a fancy TV. To each his own.

 

Our taxes are a crapshoot. We own a lot of mutual funds and at year-end they pay capital gain distributions. Totally dependent on the market and on what they decide to sell. I try to make sure we're close to break even on our withholdings, but some of it is out of our control.

 

And one year I had a generous gain from some "phantom stock" deal at work. Despite the fact that they withheld taxes from the distribution I still had to pay anther $17K on top of what had been withheld. That hurt.

[navybankerteacher]

I used to work with another actuary- smart guy, well-paid- who always looked forward to getting a refund each year so he could spend it on some splurge like a fancy TV. To each his own.

 

Our taxes are a crapshoot. We own a lot of mutual funds and at year-end they pay capital gain distributions. Totally dependent on the market and on what they decide to sell. I try to make sure we're close to break even on our withholdings, but some of it is out of our control.

 

And one year I had a generous gain from some "phantom stock" deal at work. Despite the fact that they withheld taxes from the distribution I still had to pay anther $17K on top of what had been withheld. That hurt.

 

 

Unpredictables like mutual fund distributions and year-end bonuses make it close to impossible to come close. In our case, defined benefit pension, Social Security and required IRA distributions make it easy to estimate to within a couple of hundred dollars - except for the occasional commission on a real estate sale, which can be rolled in and picked up on the next estimated tax payment date. We usually wind up owing $1,000 to $2,000 ( better to pay them late than to wait until May or June for a refund), but as long as we have paid 90% of previous year's tax - no problem.

[sloopsailor]

We usually wind up owing $1,000 to $2,000 ( better to pay them late than to wait until May or June for a refund), but as long as we have paid 90% of previous year's tax - no problem.

 

Both our federal and state refunds this year arrived in our account within two weeks after filing. By mid March bothe refunds were available for us to use for whatever purpose we want. I recommend that you don't post information you know nothing about. Every time you do, and you have been doing so a lot on this thread, you look more and more out of touch.

Edited April 18, 2014 by sloopsailor

[momofmeg]

It tends to work out - at roughly age 65 income drops substantially, and at least a good portion of Social Security income is untaxed, so the loss of a major deduction like mortgage interest is offset by a reduction in taxable income - hopefully matched by a decrease in day to day expenses like commuting to work and other work-related costs.

 

Lol! Both of us work form home now so I can't count on that savings. However, we have been thrifty in order to not worry about our retirement. We do love to take a cruise about once a year and every 2 or 3 years an especially nice vacation, but aside form that we are not big spenders

[momofmeg]

Both our federal and state refunds this year arrived in our account within two weeks after filing. By mid March bothe refunds were available for us to use for whatever purpose we want. I recommend that you don't post information you know nothing about. Every time you do, and you have been doing so a lot on this thread, you look more and more out of touch.

 

Ours was not even a week for both. We filed in late February too, not right away.

[PR0318]

For once I got a big return, just enough to pay for a cruise at Christmas time for my family, nice little bonus. I normally have to pay in every year.

[navybankerteacher]

Both our federal and state refunds this year arrived in our account within two weeks after filing. By mid March bothe refunds were available for us to use for whatever purpose we want. I recommend that you don't post information you know nothing about. Every time you do, and you have been doing so a lot on this thread, you look more and more out of touch.

 

Two weeks from April 15 is, essentially, May. If you have not experienced the delays we have in receiving refunds, good for you; but timing of refunds we have received is information we do happen to know about.

 

Just what is your problem?

[momofmeg]

Two weeks from April 15 is, essentially, May. If you have not experienced the delays we have in receiving refunds, good for you; but timing of refunds we have received is information we do happen to know about.

 

Just what is your problem?

 

I do not think she has a problem. You are reading things here. Now that we can electronically file it is much faster now. You just did not know as you haven't received a refund in a long time.

[sloopsailor]

Two weeks from April 15 is, essentially, May. If you have not experienced the delays we have in receiving refunds, good for you; but timing of refunds we have received is information we do happen to know about.

 

I received my refunds in early March, not May, so I don't have a clue what your point is. I also don't procrastinator and file on the very last day, especially if a refund is in order. Our refunds ALWAYS arrive withing two weeks of filing, which we do in late February or early March, and it has been that way for years. You said "wait until May or June for a refund". That would only apply if you either filed in late May or early June, both of which are late filings, well after the due date of April 15th. Is that how you manage your taxes?

 

Just what is your problem?

 

I don't have a problem. I am quite pleased with how we manage our taxes. As other's have pointed out on this thread, it is YOU that has the problem.

Edited April 19, 2014 by sloopsailor

[lady_cruiser]

Does anyone else use there tax refund as a vaction fund ....... This has been a good system for us, we have done this since we were married in 76 and most years we did get to do something. Over the years we have moved up in refunds and trips , we spend more than our refund but it is a good start .

Nope but starting the first week in January I put $1.00 in a vacation savings account. Week 2 - I put $2.00, week 3 - $3.00 and on until the end of the year. At the end of the year I have over $1,000 saved to put on a future cruise.

[fortinweb]

Nope but starting the first week in January I put $1.00 in a vacation savings account. Week 2 - I put $2.00, week 3 - $3.00 and on until the end of the year. At the end of the year I have over $1,000 saved to put on a future cruise.

 

My paycheck is automatically deposited by my employer on payday. I have the bulk of it deposited into the main savings account used for day to day expenses. But 8% is deposited into our vacation fund. In this way over the course of the year we accumulate enough each year to take at least one vacation. Tax refunds are deposited into the vacation account by the IRS, increasing the vacation fund even more.

 

We also have three additional accounts that a portion is also automatically deposited into - one each for property taxes, home and auto insurance, and "play" accounts. It's surprising how quickly these accounts grow without affecting normal day to day expenses.

 

None of this requires any effort on my part - it is all done automatically through deposit arrangements made through my work and the IRS.

Edited April 19, 2014 by fortinweb