Why are large tax refunds considered giving the government an “interest-free loan”?
The IRS states that, “Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS.”
Go to the IRS website (https://www.irs.gov/taxpayer-bill-of-rights) and explore your rights and the IRS’s obligations to protect them.
The Taxpayer Bill of Rights lists 10 different rights. Pick two of them to explore in more detail. Explain these rights to your classmates, and what changes you would you make to improve them.
Do not forget to make your posts to the other topic this week.
You are a CPA being paid to prepare a tax return for a client who just started a new job. Your client is attempting to fill out Form W-4 and has asked for your help. He would like to receive a large refund when he files his return and would therefore like to claim as few allowances as possible. Even though he is married and has four children, he is planning on claiming no allowances. What would you tell your client? Do you agree with this financial planning strategy? Why are large tax refunds considered giving the government an “interest-free loan”?