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IRS: Is it better to owe taxes or receive a refund?

Tax season is upon us, and millions of Americans are filing their taxes in hopes of seeing a refund from the IRS, but is owing better?

IRS building sign for the agency that accepts tax returns and sends tax refunds

Many people like to see larger refunds, but some end up owing the IRS in the end.

According to The Sun, it may actually be better to owe taxes to the IRS than to have them owe you.

In an interview with a woman named Christy Bieber, The Sun shared that she pays every year.

She finds it important to pay at least 90% of what is owed.

What are the tax rates and brackets for 2021 taxes?

Her reason for preferring to pay is so she isn’t giving the IRS extra money she could be using throughout the year.

What is a refund from the IRS?

Many people are excited to see a refund, but at the end of the day, it isn’t free money.

What you’re given back by the IRS is money you simply overpaid.

This means you could have kept the money all along.

Who can qualify for 2022 American Opportunity Tax Credit?

This is money you could have easily invested throughout the year. You would have made interest on it, but instead it sat with the IRS.

The money could also have been used to pay debt you owe or to add to your savings.

Once the IRS has the money, you won’t see it until next tax season.

Categories: News