Tax Refunds: the Bigger the Better

A couple of years ago I wrote about how after 30 years in the tax prep business I still believe that tax refunds are a good thing if not one of the best of things in the tax world. Getting a big tax refund feels better than being two steps ahead of the parking enforcement officer or seeing the person who "nudged" you out of the fast lane being pulled over.

Academics, finance professionals, actuaries, daytime talk show hosts, and many others disagree with me - they believe tax refunds are bad and they let me know loud and often. Many of them think a tax refund is bad because it means you made the government an interest free loan when you could have been using the money. Nevertheless, I'm a realist and most people aren't budgeting the way they should and they definitely aren't saving the way, or as much as, they should. Therefore, I maintain tax refunds are a great thing and are an alternate method of budgeting and saving for a majority of Americans.

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