4/01/2007

Tax Time! Standardizing

There are some of us that are willing to dig deep to get a greater refund as we prepare our federal tax return. The one-time credit relating to a federal telephone excise tax is an example. An article in late January describes how individuals are willing to do great amounts of legwork to get a higher refund. For me I was willing to take the standardized credit instead of pulling phone bills for the past ten years and adding them up to see if I could achieve a higher refund for past payments of the federal excise phone tax.

Needless to say, time is valued differently for each of us. Some might assume that the government added all of the past federal telephone excise tax, estimated the number of returns to be filed and then set the value for each number of exemptions. For myself I would assume that the government estimated the value per exemption based on a price that would create a higher demand for taxpayers to take the standard credit and not do the legwork that would reveal the higher refund that they could achieve, meanwhile still having the greatest amount of surplus for government as possible. The government may seem greedy, but one may also say I am not greedy enough!

2 comments:

Madeline said...

I, for one, do love my tax return. But, I am like Kate in that there is no way I would dig through files on the chance of getting slightly more than $30 back. I think everyone has an amount of money they would consider spending an hour for. It probably goes back to the expectation of the reward and the personal value of time. I have only been paying a phone bill for six or seven years, so even if I spent the time, I likely would not get more money out of it. However, if I were pretty likely to get another $100, I would gladly spend an hour, maybe two. Someone probably did do the math, and I may be getting low-balled. But not having to sort through 10 years of records makes that just fine with me.

Jada said...

I, too, love my tax return. Standardizing is much easier and quicker and nets me a good return. However, there isn't just the new phone credit, there is mortgage credit, and a chartiable credit (good for Utahns that pay tithing) among others that make itemization a good choice. I have actually wasted time in previous years doing taxes both ways to see which would net me the higher return. Time is a definite element that needs to be considered, and time means more money to some and the non-monetary benefit sometimes outweigh the monetary benefits. However, the less hassle of standardization is another element to be considered.