As people desperately need whatever extra funds they can get their hands on, early filing for income tax refund is at an all-time high. Turbotax, as well as other filing companies are being inundated with people trying to get their refunds as soon as possible.
I'm sure most people these days have bills upon bills that need paying. Every year, a lot of people get a small "windfall" from the Treasury in the form of a tax refund. usually people take this money and do something special for themselves as sort of a treat for the work they've done all year long. I know I do.
This year, something tells me things will be different. I wonder how many people will be like me and take whatever refund they get an apply it solely to bills.
In the rush to get this money, I'm hoping people don't fall for the rapid refund loan "scam" as I call it. Many companies offer a fast way to get the refunds, but they take a large percent of the money for themselves.
The IRS offers e-filing and the ability to have the refunds direct deposited into a person's account very quickly, so you don't have to pay the ridiculous fees these companies charge. According to one article, one CPA had this to say:
taxpayers who e-file and use direct deposit can benefit. E-filing can speed up the refund process to an average of three to five days for state returns and 10 days or less for federal returns. Refunds can take 30 days by mailing in paper forms. Electronic filing also increases accuracy and maximizes allowable deductions, Mr. Devine said.
Almost 58 percent of all returns were filed electronically in 2008, according to the IRS’ Web site. And nearly 27 million people prepared their own e-file returns, an increase of more than 19 percent from 2007.
Anyone with an adjusted gross income up to $56,000 can use the standard free file options. This year, the IRS is offering free file fillable tax forms to taxpayers with incomes of more than $56,000.
But with the fillable forms, the tax preparer needs to know what they’re doing, Mr. Devine said. There is no system in place to check for errors, as with other online sites and programs.
New credits this year will help maximize refunds or pad the blow of paying in to the government, including first-time home buyer credit, recovery rebate credit, hope and education credit and disaster relief credit.
So, what will you do with your income tax refund this year?