What Exactly is a Tax Refund and How Should You Use It?
Do you remember filling up a form back when your current employment had started? The title W-4 was written in bold somewhere at the top and you were to specify how much of your salary are you willing to withhold every month to pay as taxes to the government. These deposits you made with your employer add up with the IRS and if at the end of the tax year your net tax is lower than the sum you had already paid, you are then eligible for a tax refund.
Every year, millions of people receive tax refunds from the IRS but most of them confuse it as a chunk of money coming from the government. The technical concept of tax refunds runs deep and hence the money deserves a worthy investment.
What exactly is a tax refund?
A tax refund is ultimately your hard-earned money that was sitting with the IRS. It is not a bonus for paying your taxes on time. Nor is it some form of investment that comes with an interest. Many opt to withhold a considerable sum from their paychecks to avoid the risk of owing taxes to the IRS at the end of every tax year and attract a penalty. This way, irrespective of your financial situation during the tax season, you know that the IRS cannot bother you due to unpaid taxes. In fact, receiving a refund can help many ease their current situations.
What to do with the refund money?
Now, the tax refund is a part of your salary that you were not using the entire year. And it is highly probable that you will not need it any time soon unless exceptional cases have risen. So, your first thought with the tax refund should be to convert it into an asset that will fetch you immediate and continuous returns and help your overall life.
This is where the idea of using the tax refund as a down payment to buy a used car comes in. If you were planning to invest in a car soon, employing the tax refund is the ideal opportunity. You will preserve your savings in the process, buy a commodity that will actually help you and your family, and continue to finance it from your ongoing salary without causing a dent in your household’s finances.
At Family Auto of Fountain Inn, your tax refund money should be enough to buy a quality used car. Our inventory is one of the largest in upstate South Carolina which enables you to pick a used car of your choice without making compromises on make and model. Along with this, we offer no credit check buy here pay here financing where we do not look at your credit score to extend an auto loan. The tax refund money also makes your loan approval easy. So, treat your tax refund the way it is and get the car that you have postponed throughout 2020. The tax season is ideal to visit Family Auto, work out suitable financing options with our flexible down payment system, and drive home a quality used car with an assured 2-years/36,000 miles warranty.
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