posted on Dec, 2 2010 @ 12:37 PM
What you are proposing is a tax increase.
Tax "refunds" are simply a return of excess monies held in anticipation of a tax bill.
Do your withholdings properly and you shouldn't be getting a refund.
On a related note - I have never understood why people voluntarily over withhold with the idea that getting a refund is some kind of a "bonus". No,
that's simply treating the IRS like a bank. That doesn't pay interest.
What you want to do is calculate your withholdings to equal the amount you will owe in tax, so you have more money at your disposal over the course of
the tax year or quarter. Which you can then put in a savings account or other investment that will earn interest.
The IRS is not a bank.
The people that kill me the most are the ones who say - yeah but - if I have that extra money - I'll spend it. It's better for the IRS to keep it,
then I'll get a big check at the end of the year.
The IRS is not a bank, it does not pay interest, and its a sad comment that some people wish to be baby sat, money wise.
In any case, back to the topic at hand here - letting the IRS keep any excess money withheld - in the end amounts to a tax increase. And yes, a tax
increase might help the economy. Theoretically. Provided the government actually spent this additional money on economic stimulus