Everyone needs money, that’s a fact. Some people manage their money better than others…another fact, one which may be harder to swallow. What I want to do here is try and explain why, if you’re desperate about receiving your IRS refund, something is wrong.
It’s January, which means the question Where is my refund? for 2014 is beginning to surface. Lots of anxious taxpayers file taxes even before the IRS is ready to accept tax returns. Why? Because they are desperate to get refunds ASAP. Why? Here’s the problem. Its’ most often because of money-management issues. Let’s break it down and see how we can tackle the issues and manage money a little more wisely.
I’m Poor- That IRS Refund Will Really Help Me Out!
If you are living on minimum wage, or just getting by and you’ve already tweaked your household budget so much you’re living a Spartan existence, then yes, an IRS refund check of several hundred dollars means a lot to you. But did you know you could have had that money months ago? You could have had that money all along? Why? Because it’s actually your money! You loaned it to the IRS for the year, so they could pay their bills.
Yes, you in your near-poverty existence, loaned the IRS money. Doesn’t that sound ridiculous. But by having too much taken out of your paycheck each month, that’s what you’re doing. Your refund is just them returning that money, because too much was sent to them in the first place.
If your IRS Refund is big, ADJUST YOUR W4!
Get a fresh copy of the W4 form and resubmit it to your boss and stop having too much money taken out of your paychecks. You won’t have to be desperately asking Where’s my refund? in 2014 because you’ll already have what was yours in the first place. Stop loaning your hard-earned money to the IRS (interest free!) and keep it in your paycheck. Your IRS refund isn’t your ticket out of poverty, it’s just the IRS’s way of taking advantage of people who haven’t learned about withholding and the W4 yet. Adjust your W4 and yoru employer won’t take so much out of your paycheck. Yes, it means your IRS refund will be smaller for tax year 2014 but it also means you’ll have more of your own money in your pocket as soon as you earn it.