Are tax returns a scam

Discussion in 'Off Topic Forum' started by pc747, Mar 17, 2018.

  1. pc747

    pc747 Administrator
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    Just to be clear I am not saying taxes are a scam as there are a lot of emergency service personnel, armed forces, and other government workers who depend on tax dollars for payment (unfortunately the law makers are paid too much so they are paid too little). What I'm referring to as a scam is people waiting every year for a $2000 tax return (if they even get that) like it is a gift from the government. Only to not be paid a cent of interest on this free loan and if your "check" is mailed late there are no consequences.

    Meanwhile if you miss your date or forbid you get audited and a minor mistake was made. There will be this fee with massive interest that stacks up by the day. Basically a standard that is imbalanced.

    Now this again is not an anti government thing, anti tax thing, or anti Democrat or Republican thing, this is just a thing to make me think.

    I just hear of stories on the news every year of the government getting backed up with getting out people's returns as well as money that the government technical owes but goes unclaimed.

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  2. PereDroid

    PereDroid DF News Team Reporter

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    To be fair:
    The penalty for filing late is normally 5 percent of the unpaid taxes for each month or part of a month that a tax return is late. That penalty starts accruing the day after the tax filing due date and will not exceed 25 percent of your unpaid taxes.

    Curious if other countries do taxes like this?

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  3. pc747

    pc747 Administrator
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  4. kodiak799

    kodiak799 Gold Member

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    If you're getting a refund, much less a big refund, you're doing it wrong. Just increase the number of exemptions on your W2 until your witholding better matches you're actual tax liability.
     
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  5. pc747

    pc747 Administrator
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  6. pc747

    pc747 Administrator
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    ^ You beat me to it by a few minutes.
     
  7. JandN2639

    JandN2639 Active Member

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    Read the post in this forum about political threads. They don’t belong on Tapatalk.


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  8. PereDroid

    PereDroid DF News Team Reporter

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    This isn't really politics.

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  9. me just sayin

    me just sayin Diamond Member

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    I rather give them an interest free loan during the year than have to pay a huge amount at the end of the year.
     
  10. Sajo

    Sajo Diamond Member

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    I agree that political threads have no use here, and the ones that have been started have been closed. But I don't see this as a political thread at all, it's a thread about managing your tax money wisely. As long as users don't turn it political, what's the harm in a nice discussion about managing our money wisely?

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  11. pc747

    pc747 Administrator
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    Agree.

    Plus I made a statement in the op stating it was not political. That I was not going after one party or politicians. This was a discussion for knowledge.

    I intentionally posted two articles, one that talked about why people would rather just pay the extra money and get it back in a larger portion, and another that talked about changing your exemptions to where you're getting back less. I did this because I wanted to open the discussion and increase knowledge.



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  12. Jonny Kansas

    Jonny Kansas Administrator
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    Unfortunately, I know from personal experience how they work. Again, not trying to bash the government or get political, but...

    I made a mistake on my taxes one year. 2 or 3 years later, I get a letter from them saying I owe them X dollars for the mistake and that I have 30 days to pay them or at least make arrangements for a payment plan. They didn't catch my mistake for that long, letting me believe that I'd done my taxes correctly that year, and then wanted their money within a month.

    On the flip side of that, just in the last year, I got a check for something like $12 from the government. What does it say? Tax year: 2013.

    So I had to pay them right away, but they took even longer to pay me back than it took for them to realize that I owed them money.

    It is what it is. I'm one person filing taxes and they're an organization collecting on millions of Americans, so I get it. Just thought it was funny how all of this shook out.

    That said, I PREFER to get a refund. I have extra held from my check to ensure I don't have to pay and always get a refund. Are there better ways to save up and have a few thousand extra dollars each year? Sure, but this is already in place and I don't have to think about it. I'm not good at saving. I set up an account with Digit, which links to my main checking account, checks my spending, and sets aside money as it's available in a savings account. I also use the bank Simple for my main debit account. I can set goals and it will save so much each day toward those goals and let me know what's "safe to spend". I'm always pulling money from that Digit savings account and/or digging into the funds set aside for my goals. I've got a nice cushion setup, but if I didn't do that, money would be WAY more tight for my family. So, knowing that about myself, it's nice to know I'll have this break shortly after Christmas time where I can pay some extra on debts and/or catch up all of those goals and stick some extra in a separate savings account that we don't touch.

    Just my two cents. I know plenty of people who prefer to take home as much as possible during the year and then get little-to-nothing back. If that works for you, more power to you, but this is the way that works for me and my family, so I'll stick with it.
     
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