The reason my return is so large is twofold:
·
Since I only started working in June, my gross
annual income was fairly low. This means
that my initial deductions ($3,900 personal exemption and $6,100 standard
deduction) stretched a lot further than they will next year when I make a full
salary.
·
I paid almost $3,000 in student loan interest.
(I paid off everything that had accrued while I was in school in addition to
the monthly accrual since graduation.)
This means I managed another $2,500 deduction that wouldn’t even have to
be included in itemized deductions. Woo
hoo!
The only downer about getting a big tax refund is that if I’d
kept that money over the last 7 months, rather than paying it to the
government, I could have been putting it in my Roth and earning interest and
returns on it. I know that the best
situation in the long term would be to actually owe a little bit because then I
would really be earning the maximum I could.
Wouldn’t it be nice
if the government also paid interest to you on the excessive money they
withheld? How did you tax return turn
out? What will you do with your
windfall?
