I respectfully disagree, seen it to many times. Let him eat if he wants to take the gamble. I wouldn't call 8 or 9 grand dollar high dollar to the IRS.
This thread is an excellent case study on taxes, money and demographics in America. Keep it coming, I'm going to bookmark this in case I ever decide to get that MBA.
You're tax refund isn't all "income tax you overpaid." If you're somewhat wealthy or at least firmly middle class you're likely to get some freebies. Namely, the mortgage interest deduction, which essentially pays out people for taking on debt.
Good point. People that are poor and have lots of kids also make out like bandits thanks to child tax credits. I know some shady losers who get back 7 or 8k and end up paying zero net income tax thanks to a combination of lots of kids and getting paid in cash under the table. I've tried reporting them but the IRS didn't seem to care.
I have seen this as well. Individuals who don't get their own insurance, hardly ever work, but then get $10K at year end from child tax credits. No point really in trying for those people.
The issue is that the IRS will almost definitely catch a reporting mistake that the filer made. Whether or not there is a physical audit is another matter entirely, but a paper audit is certainly probable if there is an actual error. Regardless, any filer who is getting a larger (or smaller) amount than they are used to and there has been no real change in their situation, should double and triple check their filing rather than gamble on the IRS not taking the trouble to check on things.
