Get Your Refund In Your Paycheck
By Terry Rigg
It's Time To Think About Your Taxes
Yes, I know that tax time has passed for most of us.
I also know that most of you anxiously await that W2 form each
year so that you can take it straight to a tax preparer anticipating a big
refund. In many cases this could be costing you a bundle.
Did you know that you can put that tax refund in a savings or
other interest bearing account throughout the year?
Why not get that money in your paycheck instead of allowing the
government to keep it for a whole year interest free.
Even if most of your refund is a result of the Earned Income
Credit you can still receive it in your paycheck.
I just recently completed my Son-in-Laws W4 form (Employee's
Withholding Allowance Certificate 2004) for a new job. There are 5 in his
family. He was able to claim 11 exemptions, legally. This means that he will
have very little Federal Income Tax withheld from his check.
Why would you want to do this and deprive yourself of that Big
First, you may need to use the money right now to pay down your
debt. For some people, this could add $50 to $100 a week to their paycheck.
Second, if you are struggling to make ends me you need the money
Third, you could add that much more to your 401k or other
If you would like to receive more of your money in your paycheck
all you need to do is fill out another W4 and claim as many exemptions as
possible. Just ask your employer for another W4 and read it carefully. Make sure
you get the 2004 form because the form has changed since 2003.
You can also print your own form and even fill it out on your
computer. To do this just go to http://www.irs.gov . Click on "Individual" in
the left column. On that page click on "Forms & Publications". Scroll down to
"Fill-In Forms". In the forms box find "2004 Form W-4 Employee's Withholding
Allowance Certificate". Click on the link that shows up and the form will open
and allow you to enter your information.
If you qualify you can do the same thing with your Earned Income
Credit. The only difference is that you will need to complete the "Earned Income
Credit Advance Payment Certificate" Form W5. Check IRS publication 596 to see if
It's your choice. You can choose to give the government a free
loan each year or get that money when you most need it, NOW!
Terry Rigg is the author of Living Within Your Means - The Easy Way
and editor of The FREE Budget Stretcher Newsletter and Budget Stretcher
http://www.homemoneyhelp.com. He has 25 years of experience
counseling individuals and families concerning their personal finances.