When you look in the news lately about taxes it’s easy to see that there is a big battle brewing for all those in our government. A tax battle as to who is proposing the right course of action to help boost the economy and make the general population satisfied. Of course no matter what the government decides to do they are not going to be able to please everyone. Hopefully they will manage to hit the biggest target and start from there.
The big tax battle that is catching a lot headlines right now is the proposed tax cut to help the everyday working person. It looks like the general plan is to try and get a tax cut that would give a single person an extra $500 and a couple and extra $1000. The argument of course is how all the people in Washington will agree on how to and if they even should go forward with this proposed tax cut.
While reading the headlines and recent stories on all the tax cut news I came upon this very interesting article. Basically the article points out that last year the IRS issued well over 100 million tax refunds last year at an average of $2400 per refund totalling well over $250 billion. It also pointed out that about 75% of all Americans get a similar tax refund year after year. That’s approximately $250 billion dollars every year that we are collectively over paying on our taxes every year! The article went on to point out that with a simple adjustment to your w-4 that we could all immediately give ourselves a pay raise of about $2400 a year! They even put in a link to a handy dandy calculator to help you figure out what changes you need to make to your W-4 to make it happen.
Imagine that, we the people have the power to put extra money in our pocket for every pay check! So why don’t we? That is the $250 billion dollar question now isn’t it. Perhaps we are too scared to make a mistake and then we end up owing the IRS? Are we just lazy? Maybe the concept of “I get a big tax refund every year!” is so programmed into our heads that we just don’t realize that we are paying way over the required taxes. What do you think? Why do so many Americans over pay their taxes year after year?
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