| tart --> | | | | This year, the IRS is getting into the fray. It is offering a |
| The IRS is offering a new split tax refund option this | | | | split tax refund option for people that choose to have |
| year for parties that choose direct deposit for their tax | | | | their refund deposited directly into their bank account. If |
| refunds. Why? The agency wants to promote savings. | | | | you file form 8888, the IRS will split up your refund as |
| Let's be honest. What is the first thing you do when | | | | you indicate and send it to as many as three different |
| you get a tax refund? Do you pay off bills? Do you | | | | accounts. |
| put it in your savings? Buy some stocks? Nah. Most | | | | You are probably wondering why the IRS would do |
| people go out and buy something with it. In highly | | | | this. Well, the lack of savings issue is starting to get |
| technical financial terminology, this is known as "blowing | | | | very worrisome. The idea is to try to get you to put |
| it". | | | | some of the money in your bank account to be spent, |
| Americans are infamous for their saving habits. | | | | but also some in a savings account. Yes, things are |
| Specifically, they have no such habits. As a society, | | | | that desperate. So, does it work? A Harvard Business |
| we save almost none of our savings. This makes | | | | School study showed a significant number of people |
| many in the government very nervous because they | | | | would actually use the split refund to put at least some |
| know sooner or later we will be looking to them for | | | | money in a savings or investment account. Walla! Now |
| money. Social security is already a mess and an aging | | | | you can. |
| population is not going to help. As a result, the | | | | Is the split refund option going to solve our national |
| government takes extraordinary steps to get us to | | | | savings problems? No. It should, however, give you a |
| save. This is why we have 401(k) and IRA retirement | | | | wakeup call in relation to how worried the government |
| options. | | | | is about the issue. |