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<blockquote data-quote="MattM" data-source="post: 4343670" data-attributes="member: 53192"><p>Yeah. Most drivers don’t qualify as the threshold is super low. It’s good for low level poor people. Most can’t think of saving but there is definite value.</p><p></p><p>I did a breakdown for a coworker who was making the same as myself (same hours).</p><p></p><p>He was withholding $25 more than myself every week. In turn, I was taking the higher allowance, and taking that $25 into a 401k. We’d each get about the same take home pay. At the end of the year, he got back $1000 (which was all of his own extra withholding). I was able to turn that $1,000 into about $2,000, thanks to the retirement credit. Plus I got my withholding back.</p><p></p><p>This dude had a tax liability of $600. I got my $300 tax liability back.</p><p></p><p>the government basically matched what I put into my 401k.</p><p></p><p>At the end of the day, they believe they have $1,000 in free government refunds. I was able to make the refund work for myself throughout the whole year, and now have $2,000 saved away. It’s all about perspective I guess. But for many years, I had been able to nearly double my 401k thanks to the government. That’s a true refund in my eyes.</p><p></p><p>Now for the average driver, save, save, save. Lowering your tax liability can save you hundreds. Use any extra potential withholding refund $ and invest it.</p><p></p><p>Other than a few credits, and lowering your tax liability, there is no free $$$. Your $1500 refund is huge because you withheld too much. </p><p>I explain it everyday in my hub from about now to about April 15th. Sad stuff</p></blockquote><p></p>
[QUOTE="MattM, post: 4343670, member: 53192"] Yeah. Most drivers don’t qualify as the threshold is super low. It’s good for low level poor people. Most can’t think of saving but there is definite value. I did a breakdown for a coworker who was making the same as myself (same hours). He was withholding $25 more than myself every week. In turn, I was taking the higher allowance, and taking that $25 into a 401k. We’d each get about the same take home pay. At the end of the year, he got back $1000 (which was all of his own extra withholding). I was able to turn that $1,000 into about $2,000, thanks to the retirement credit. Plus I got my withholding back. This dude had a tax liability of $600. I got my $300 tax liability back. the government basically matched what I put into my 401k. At the end of the day, they believe they have $1,000 in free government refunds. I was able to make the refund work for myself throughout the whole year, and now have $2,000 saved away. It’s all about perspective I guess. But for many years, I had been able to nearly double my 401k thanks to the government. That’s a true refund in my eyes. Now for the average driver, save, save, save. Lowering your tax liability can save you hundreds. Use any extra potential withholding refund $ and invest it. Other than a few credits, and lowering your tax liability, there is no free $$$. Your $1500 refund is huge because you withheld too much. I explain it everyday in my hub from about now to about April 15th. Sad stuff [/QUOTE]
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