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OT: Tax Refunds- POLL

zerostepdrama's picture

What do you typically do with your tax refund?

Use it to pay bills, splurge on something, invest, save?

How do you feel about "lower income" workers who manage to get $5,000+ back on their refund because they have a child.

Would you rather have the extra money throughout the year or do you like getting a refund?

What are some of the more unusual items that you get a deduction/credit for?

Comments

thinkthrice's picture

I USED to be a liberal. As a single mom myself, I thought everyone was experiencing the same sort of struggling that I was. BOY was I WRONG!! My thought process did a 180 when I started to work for Subsidized Housing. It's GOOD to be the government's pet. We have the richest "poor" people in the world!!

ProbablyAlreadyInsane's picture

I work for subsidized housing... It frustrates the heck out of me when I see people who refuse to get jobs because they can just get paid to live somewhere instead... use it to get on your feet! Not because you want to take advantage! UGH!

Also it frustrates me because they never leave, so there's like YEARS of waiting lists in a lot of locations, which means a lot of people who genuinely need it while they get back on their feet, realistically can't.

thinkthrice's picture

yep. And the people who truly need the help get put through the ringer. They get discouraged and give up. While others are rubber stamped through the system.

I saw this first hand in my own little family. My son, who is biracial, would instantly be approved for any assistance I applied for, whereas my daughter would come home from school with boatloads of auditing paperwork.
Same household, same income.

ProbablyAlreadyInsane's picture

What do you typically do with your tax refund? Well this year we're paying a lawyer and then bills to help get us on our feet faster... But I'm also buying a new dress }:) I've always wanted a nice one! Just have always been too cheap! I'm not even a dress wearer... But I would find a way to use this!

How do you feel about "lower income" workers who manage to get $5,000+ back on their refund because they have a child? That's us right now... But with 2 kids... It's not because we're trying to be... Once we get on our feet I fully expect that to go down dramatically, and we're even using the money to help us get there! Same as welfare, it doesn't bother me so long as it's being used to better the situation instead of just as the way of life.

Would you rather have the extra money throughout the year or do you like getting a refund? I like the refund, it's like saving and not being able to touch the money at all. So then you get it back and haven't spent it on useless things.

What are some of the more unusual items that you get a deduction/credit for? Just the usual stuff!

hereiam's picture

I just put my tax refund into my savings or checking (it's not usually much).

Don't get me started on low income people who get thousands back because they had a kid (or 2 or 4). My SD does not even work or pay taxes (in fact, lives off of our tax dollars) but she gets a refund? :?

I don't care for getting a big refund, I can save my own money and would rather keep it in my own account throughout the year.

I don't really have any unusual deductions or credits, just the usual property/real estate taxes and the donations I give to charities throughout the year. I did donate a car in 2016.

secret's picture

I generally invest it. I regularly get anywhere between 5k and 10k back.

With school credits, and maxed out RRSP, RESP and TFSA contributions as much as possible, I have been averaging an income reduction of about 20k a year, though.

TwoOfUs's picture

We never get a refund...we always owe because we're freelance/in business for ourselves.

If we were ever able to claim even ONE kid out of the three as a dependent on taxes, we would get a refund. But nope. We get to pay CS and whatever 'extras' BM thinks we should pay...while she claims all three kids as dependents every year (and HoH and EIC because she's now technically a 'single' parent...what a scam).

Makes me mad. Can't think about it.

thinkthrice's picture

Can you get the CO changed to do a 2/1/2/1 swap? Chef cowed to the Gir by letting her always claim the two youngest one for well over 10 years. BIG mistake. We recently got the CO changed to a 2/1 swap the way it SHOULD be for 3 kids.

TwoOfUs's picture

We asked...tried that. She said 'no; but continued to grouse about being solely responsible for health insurance for the kids.

DH was dumb when he got divorced and didn't protect his interests enough at all. In our state, if taxes aren't explicitly spelled out in the CO, CP gets to claim by default. Our only hope was to get her to sign one of those 8332 forms...which, of course, she would not. Money goes only one direction for BM...that's for sure.

ksmom14's picture

We always end up using most of it to pay bills, and then a small portion we'll do something fun with it.

We usually get between $5-$10 K back each year, but we get to claim all the kids (3skids, DD2, and now this year DD4months too), and we're not low income.

I've debated changing it so that we'll have the money throughout the year instead of a big tax return...but I fear that it won't be put directly to bills like it does with the lump sum.

Ninji's picture

"How do you feel about "lower income" workers who manage to get $5,000+ back on their refund because they have a child."

DH and I have opposite views one this one. I don't think individuals with children should get extra money back. If anyone should be getting a break, it should be those without children. Child-free people don't use public schools, they aren't getting "free lunch" at school, they aren't riding school buses, etc.

DH thinks people with kids should get the money because kids are expensive. No shit. Maybe a thought you should have had before you humped a loser without a condom.

TwoOfUs's picture

Yeah.

But it's NCPs and the dumb stepmoms who love them who get the worst deal...the short end of the stick every time.

BM is NOT low income. She's solidly middle class. But she gets 8-10K back every year because she can claim all three kids and also gets the additional head of household bump because she's 'unmarried'

So...she gets CS tax free for all three kids (or, used to) but, in the eyes of the IRS, she's still considered a 'single mom' for some reason. Give. Me. A. Break.

Cover1W's picture

I get the refund for DH and I - I file separate/married due to his IRS debt. Taking no chances on the IRS grabbing anything.

So I declare all exemptions.
Then I divvy it up.
I first calculate only my income and personal exemptions and note that refund total.
Then I add in the household exemptions - that additional refund gets (usually) split three ways; added to my personal refund, to DH and then to the house account.

This year the house refund will likely be used for re-flooring and putting a new toilet into the downstairs bath and anything left over will be used for a new kitchen counter/sink.

DH agreed to BM getting the tax credit for the SDs every.single.year. Even though they have 50/50. He's really regretted that lately.

DaizyDuke's picture

We put ours in savings and use it throughout the year as needed for stuff that comes up... like needing to buy a new lawn mower, or replace horse fence, or have back deck replaced etc. We really try NOT to touch it, but generally end up spending maybe 1/4 of it every year.

I don't even want to talk about the scuzz buckets who do nothing and get thousands of dollars back.

We own another house, that we rent out, so DH always writes off any expenses related to that. I know our accountant manages to include our cell phone bill as a write off somehow... I don't know. I don't ask. She asks the questions every year and fills in the blanks, we sign and check gets deposited.

Thumper's picture

Will someone PLEASE explain to me how 'single moms' get 10k back for Christmas sakes?

Do you really think the irs follows thru with people who call fraud in?

queensway's picture

Claiming head of household on your income tax is LEGAL. If you are a single mom and you have a home and you are raising your children in it this is your right to do this. :?

TwoOfUs's picture

Sure, it's legal...doesn't mean it's right or fair when it comes to blended family situations.

By law....CP doesn't have to claim CS as income. So, in our case, we were giving BM about 20K a year in CS to care for the kids, plus a lot of extras...plus caring for them on our time.

But she's technically a 'single mom'(Um, no...she isn't. She actually has not one but TWO other adults helping to provide for her kids...but, legally, she's a 'single mom' to the IRS.)

So...she gets to claim HoH and all 3 kids...despite the fact that she does NOT provide for those kids on her own...which is what the deduction is actually for. Meanwhile, NCP gets screwed every direction.

It makes sense that true single moms trying to run a household on their own get this extra deduction. Divorced moms taking every child deduction every year, raking in CS from an ex, and getting all kinds of extra financial support and other resources from the other parent and/or the other parent's new spouse...that's just gaming the system.

queensway's picture

When I was a single Mom after my divorce I struggled. I owned my home and raised my children in it. And guess what I WAS HEAD OF HOUSEHOLD. I worked and payed my taxes and if you think because it is legal that doesn't mean it is not right you are so judgemental. How dare you say that. Until you walk in other peoples shoes you should not act like you are the "doesn't make it right police". You have no clue what it is like. And by the way for your information CS is a claim on income. You just don't pay income tax on it. Gaming the system SMDH Now I max out every year on Social Security and I will never get that money back. But hey I am paying money into the system while other people are not.

queensway's picture

Sorry Zero I know this was not what your blog was about. I just can't stand people being so judgemental. Anyway I save half and spend half.

TwoOfUs's picture

Obviously my statement doesn't apply to everyone who takes the HoH deduction...I understand why it exists. I just think it's bogus for divorced moms who are getting A LOT of child support and other forms of help from a co-parent to get 'single mom' status and all child tax deductions, too. That's an absurd loophole in the system that isn't fair or right. That's not saying anything about you or your status. By law, a divorced mom who decides not to remarry could be getting 10K a month in child support...all tax-free...and still be claiming HoH and EIC and all kids. How does that seem fair to you?

And, no...you don't include Child Support as part of your income, according to the IRS. I can't even begin to understand what you mean by 'CS is a claim on income. You just don't pay income tax on it.' That doesn't make sense...if you claim it, that means, by definition, that you pay taxes on it. It's not considered income...and I don't think it should be, honestly, because it's for the kids and has already been taxed as income once...but I also think NCPs should get some consideration when it comes to Child Tax Deductions and HoH. I don't know how you can claim with a straight face that you're HoH when over half of your monthly 'income' comes from CS.

queensway's picture

Talk to a CPA. You claim child support as other income besides your job on your income tax forms. Do you even understand besides head of household how many other things people claim on their income tax. Tax loop holes. Come on. If it is legal you need to get over it. You don't make the rules. The government does. And the government doesn't care what you feel about divorced Moms or your BM. LOL Make sure you don't claim any deductions this year so you feel better because it is the right thing to do. }:) Good luck

TwoOfUs's picture

You're incorrect. You aren't supposed to put child support anywhere on your income tax forms. You should get a different CPA.

Also...'other people are taking other kinds of deductions' is a pretty lame defense. I understand and would take every deduction legally available to me...I just think the law/code needs to be revisited to reflect the substantial support that many NCPs provide without getting any tax benefit. It's unbalanced.

Livingoutloud's picture

When I filed single I always owed because I make too much and for awhile I worked two jobs. Now we file married and get money back only because DH pays spousal support almost 1k a month. Otherwise we would probably ow because my DH also makes decent amount. So it’s actually kind of his return. Lol we use some for annual vacation and deposit the rest to our bank accounts.

Thumper's picture

twoofus:

YES I agree
It makes sense that true single moms trying to run a household on their own get this extra deduction. Divorced moms taking every child deduction every year, raking in CS from an ex, and getting all kinds of extra financial support and other resources from the other parent and/or the other parent's new spouse...that's just gaming the system.
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Key word "TRUE single moms' and not the ones that fraud every tom dick and harry.

OR single dads.

If dad is paying cs HE should get deduction. Chances are fair to good he is paying more than 50percent to support the child.

Anyway---I am always floored when I read what it is reported BM's have in returns. When I was a divorced mom,,,geeze, I didn't come close. Guess I didn't know how to screw Uncle Sam like they do today.

Oh gosh I remember the days when WE owned in ....those were dark days. I still hold my breathe until the accountant reviews the damage. We get a small amount back and put it in our traveling fund, small house hold update fund.

I do wonder what bm's do with 10k though...that is a lot of money for poverty stricken folk.

this_is_me's picture

Just no! IDK how much you get or pay in CS but your statement

"If dad is paying CS HE should get deduction. Chances are fair to good he is paying more than 50percent to support the child."

Is completely wrong and inaccurate. I personally am ordered $250 a month which I dont get but even if I did that wouldn't even come close to paying half of what my child needs let alone just wants. My kid can eat more than $250 worth of groceries by himself in a month.