The Surpising Ways Americans Spend Their Tax Refunds

The Surprising Ways Americans Spend Their Tax Refunds Tax season is often seen as a time for stress and worry, but for millions of Americans, that yearly check-in with the IRS ends in a much needed influx of cash. For those lucky souls, Tax Day is merely the pot of gold waiting at the end of an otherwise dark rainbow made of payroll taxes and W-2 forms, and what they do with the money once they get their hands on it may surprise you. Tax Refunds by the Numbers Of the 143 million tax returns filed for 2011, more than 80 percent qualified for a refund That amounts to at least 114,400,000 people owed money by Uncle Sam That's enough people to form the 12th most populous country in the world Average tax refund in 2012: $2,700 Americans will receive an estimated $230 billion in federal tax refunds this. year What Will We Do With AU That Cash? In a recent poll, Americans said they would use their tax return for.. (42.1%) (41.9%) (13.2%) Savings Paying down debt Major purchase Fun Fact: Most U.S. Savings Bonds are electronic these days. But you get the old school paper version if you buy one using your tax refund and IRS form 8888! Credit card debt from Christmas shopping is a popular destination for tax refund dollars A recent survey showed that 35% of retailers tailor their sales and marketing tactics to capitalize on tax season Savings: 42.1% ONE HUNDRED Paying Down Debt: 41.9% Everyday Expenses: Major Purchase: 13.2% 29.7% Vacation: 11.9% 100 100 ONE HUNDRED Other: 6.7% MILK (29.7%) (11.9%) (6.7%) Every day expenses Vacation Other Recommended: If you don't have three months of living expenses saved, use your tax refund to help get there Fun things to do with the average tax refund: Bankruptcy filings have been shown to increase by up to 7% in the short term after the IRS issues tax refunds Stay for about one hour in the $65,000 per night Royal Penthouse Suite at the Hotel President Wilson in Geneva The average tax refund... Average fee to file bankruptcy: $1.477 Is enough to provide the average family of four with groceries for three months Stay for more than seven years at the $1 per night Garden Village Guest- house in Siem Reap, Cambodia 3.8% of those who filed bankruptcy could not have covered the cost without their tax refund Is more than a month's income for 2/3 of taxpayers The Waiting Is the Hardest Part Tax law changes that took effect January 1st, 2013 delayed the start of tax season by one week Of the expected $230 billion in refunds, $140 billion will be in taxpayer pockets by February 15th January 2013 February 2013 6. 10 11 12 13 14 15 16 17 18 19 20 21 22 2324 25.26 27 28 293031. 84% of those who file during the first weeks of tax season receive a refund For those taking certain tax credits, the start of the season was delayed until mid-February Waiting Is Also Your Only Option in 2013 2012 marked the last year for Refund Anticipation Loans 2012 Typical Refund Anticipation Loan APR: 150-250% According to a 2009 report: 7.2 million Americans received Refund Anticipation Loans 1 Million People $606 million: Total RAL fees racked up by taxpayers in one year $1,000,000.000 RAL fees drained $255 million from the EITC program When the IRS eliminated debt indicators from its reporting in 2010, banks were less able to judge the risk of potential borrowers 2012 Good Riddance: Republic Bank & Trust, that last major bank offering RAL's, closed its RAL business after the 2012 taxX season Sources: http://www.npr.org/2012/04/17/150787156/tax-day-isnt-bad-if-youre-getting-a-refund https://www.cia.gov/library/publications/the-world-factbook/rankorder/2119rank.html http://www.greenbaypressgazette.com/article/20130104/GPG03/301040162/Changes- don-t-worry-tax-preparers?nclick_check-1 http://www.mainstreet.com/article/moneyinvesting/taxes/1-3-americans-will-spend- their-tax-refund-thats-bad-idea http://www.theintelligencer.net/page/content.detail/id/579709/6-Billion-Hours-Spent- Preparing-Tax-Returns.html?nav=515 http://www.amtd.com/newsroom/releasedetail.cfm?ReleaselD=648762 http://money.cnn.com/pf/storysupplement/tax_refunds/index.html http://financeyahoo.com/news/pay-off-christmas-debt-210229614.html http://www.treasurydirect.gov/forms/mar0023.pdf http://blog.turbotax.intuit.com/media-lounge/tax-refunds-produce-windfall-for-u-s-families/ http://www.incharge.org/military-money/story/if-you-must-get-a-tax http://phx.corporate-ir.net/phoenix.zhtml?c=70667&p=irol-newsArticle&ID=1674437&highlight http://www.me-mag.com/stats/item/41603-retailers-who-conducted-special-marketing-for- tax-season http://www.cnn.com/2011/09/01/travel/expensive-hotel-suites-cnngo http://www.priceoftravel.com/498/the-worlds-cheapest-hostel-us1-per-night/ http://www.irs.gov/uac/Newsroom/IIRS-Plans-Jan.-30- http://tristatehomepage.com/fulltext-news?nxd, it-5 http://www.responsiblelending.org/other-consu. http://statchatva.org/2012/04/17/733/ eason-Opening-For-1040-Filers refund-anticip.ion-loans/ mintom