The nation’s taxpayers will receive an estimated $230 billion in federal tax refunds this year, according to the American Tax & Financial Center at TurboTax.
The refunds will be welcome, especially for the estimated 40 percent of U.S. households living paycheck-to-paycheck, said Bernie McKay, director of the American Tax & Financial Center at TurboTax.
In 2012, the average tax refund was $2,700 — which was equal to more than a month’s worth of income for two-thirds of taxpayers or more than three months of groceries for the average family of four, McKay said.
“A federal tax refund is the most important financial moment of the year for many families,” McKay said. “Low-income households use tax withholding and the subsequent refund almost like a savings fund, using the money to pay down debt or to cover everyday living expenses.”
About 42 percent of early tax filers plan to use their refund to pay down debt and cover the costs of rent, food and utilities, according to TuboTax. About 25 percent will save at least some of their tax refund.
Last year, half of Coloradans received a tax refund of about $500 from the state. Colorado has 2.3 million individual income tax filers. The Department of Revenue offers free Revenue Online. Filing electronically and requesting a refund by direct deposit cuts the time to receive a refund to seven to 10 days because electronic filing reduces math and omission errors, officials said.
This year’s filing deadline is April 15.
For general Colorado tax information and to go to Revenue Online, visit the Colorado Taxation Web site, www.TaxColorado.com