New NerdWallet survey sheds light on the upcoming tax season
Average refund expected to be $2,200
InvestigateTV - A new tax study from NerdWallet predicted refunds for many, efforts to decrease tax burdens and showed consumers are currently confusion over inflation.
According to the study, 55% of Americans are expecting a tax refund this year with the average amount of $2,200.
NerdWallet personal finance expert Kim Palmer shared a few suggestions for those receiving a $2,200 windfall.
- Leverage high interest rates with a high yield savings account
- Use the money to build up short term savings
- Pay off any debt, especially high interest debt
The study heard from filers who plan to lower their overall tax bill through several legal methods:
- 30% will make charitable donations
- 29% will contribute more to a retirement account
- 20% will deduct health care expenses
- 17% will contribute to a FSA or HSA
The last big takeaway from the research showed people said they were confused when it comes to inflation and taxes and how inflation impacts our tax bill.
Palmer explained the IRS is regularly makes adjustments to address inflation. For example, the lowest income bracket will be adjusted up about 7% from 2022 to lower the tax burden on this group. The highest income bracket will also see a similar adjustment.
NerdWallet suggested before you being to file, get your paperwork organized and have all your receipts and proof of income ready.
Also, remember most American can file on their own without the help of a tax professional.
The Internal Revenue Service (IRS) lists the ways you can prepare and file for free.
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