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I view over-withholding as an interest free loan to the government. No thanks. I'd rather underpay by 1% than overpay. For me 1% is over $100/mo. I'd rather ear
by sidlls 10y ago
I view over-withholding as an interest free loan to the government. No thanks. I'd rather underpay by 1% than overpay. For me 1% is over $100/mo. I'd rather earn interest, dividends, whatever on that and then pay the balance.
- II2II 10y agoThey seem to over-withhold in Canada as well, and I disagree with it for similar reasons. On the other hand, it is likely a huge benefit to the poor and those who are poor at managing their money. Come tax time, they could easily face a bill that exceeds their paycheck and paying interest on top of their taxes. It would also cost the government more since they would have to pursue collection more aggressively.
- _delirium 10y agoThey tend to overwithhold in Denmark as well, mostly because it avoids having to chase down people for payments later (giving people refunds is easier and fully automated). However they do pay interest on the overwithheld amount.
- NeutronBoy 10y agoOn the otherhand, it accounts for earnings that your employer doesn't know about - e.g. interest on investments. Which is useful for people who aren't great a money management.