• RememberTheApollo_@lemmy.world
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    9 months ago

    While this might be correct, I disagree with this as a philosophy.

    A) most people in this country don’t have cash reserves to pay an underpaid tax bill.

    B) most people don’t have the investment acumen to properly invest monies not withheld on taxes to benefit from not paying as much on their income.

    C) They just spend the money because most Americans live paycheck to paycheck, and because A and B.

    So for most people I would say that judicious overpayment of tax on the W4 resulting in a minor or modest tax refund is probably better all-around. That money will go right back into the economy or pay off some debt.

    • Flying Squid@lemmy.worldM
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      9 months ago

      It kind of feels like a year-long savings account. Once a year, we have enough money to do something like pay for new gutters.

      • RememberTheApollo_@lemmy.world
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        9 months ago

        That’s cool. However I think some people take this philosophy seriously and set themselves up for a problem. Figured my 2¢ wouldn’t hurt.

    • Bahnd Rollard@lemmy.world
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      9 months ago

      It also shields you from human error, the IRS already knows what your taxable income is (assuming your employer correctly withholds it for you). Its much less stress to file with an error in your favor than in theirs. If you own them they will hunt you to the ends of the earth and make you resolve it, but if they owe you they just send you a check and call it a day.