TULSA, Okla. — Nearly half of taxpayers rely on their federal tax refunds to pay for basic living expenses such as gas, groceries, and utility bills.
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A new LendingTree study finds that 46% of taxpayers are banking on their federal refund to pay for daily expenses, up from 40% two years ago.
This year, refund checks could be bigger for some. Bank of America estimates total federal refunds will be about 25% higher, in part because of recent changes to the tax code.
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“The fact that these refunds would be bigger this year is providing a little bit of relief to people who really need it in the face of higher prices,” Matt Schulz said.
James Cox said the reliance on refunds makes sense because of the high cost of living.
“A bigger refund would be great. But I will not hold my breath,” Cox said.
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Bill Fleming is cautiously optimistic that his refund will be bigger.
“The last few years we’ve had a pretty decent refund, so I just expect it to be a little bit more. Hopefully, we just put it back and save,” Fleming said.
“People, especially ones that live paycheck to paycheck, they’ll be the ones that’ll have to use it,” Fleming said.
Financial experts say, regardless of the size of your refund, having a plan for how you will use it before you get it is key, whether that means putting it in savings, paying off debt, or filling up your fridge and car.
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