Wednesday, March 25, 2009

Yahoo! We're Getting our $3680 IRS Tax Refund This Friday! (Includes How We Qualified For The Refund and What We're Doing With It)

I did our household taxes with H&R Block Tax Cut this season and mailed it off at the end of February. I switched from TurboTax to H&R Block's Tax Cut since it was significantly cheaper and just as easy to use, if not easier.

We mail our taxes in since I previously heard, but cannot confirm, that mailed in returns have a lower audit rate than e-filed returns. We are very truthful in our taxes (don't have anything to hide), but prefer not to have the annoyance of an audit.

When I mailed our return in, around February 24th, I included a return receipt request. We received our return receipt with a dated receipt of March 5th. Today, I received notice from my bank that our IRS refund is scheduled for deposit this Friday, March 27th. That's only 22 days for processing of the return, not bad. Had I e-filed I would have expected a 10 day turn around on our refund.

We got such a huge refund because of three primary reasons:

(1.) We took a beating on one of our rental properties. We had to evict a dead beat and make just over $16k in repairs to the property. The property went unrented for nine months!!

(2.) I accrued nearly a month of tax free leave when I worked in Afghanistan. I waited until 2008 to use most of this leave. Unfortunately, my pay was processed incorrectly and I was fully taxed for this leave... I was due for a credit on my taxes.

(3.) 2007 Stimulus Plan carryover. Our household qualified for the second half of the 2007 stimulus "check" plan on our 2008 taxes.

So, what are we doing exciting with this money??? I'll take my wife out to eat and maybe go to a movie. We typically eat out once a week.... LOL, we'll splurge and eat out twice. =)

Other than that, I just increased our scheduled mortgage payment on our investment property that has a 5.875 percent, 30yr fixed to include an additional $3500 paid to principal. We bought this house just over four years ago for $86,800 and it was immediately appraised for $97k. The house should be paid off by October of this year. Afterwards, we will be in a 10 month window awaiting a move to my next military duty station. During this time frame, we'll likely sell my 1998 Acura 2.3CL and buy a replacement car. We won't buy a new or used car though until I find out where we're going next and determine my future commute. I'm tentatively looking for orders to Colorado Springs, CO; Newport, RI; Arlington, VA or Millington, TN. All four of these locations have a location within 30-95 miles away where my wife can laterally transfer to (within her job). In all cases, we'll be moving close to where my wife's job is and i'll bear with the commute.


Unknown said...

Hi - This is Paula from H&R Block. I'm so happy you enjoyed your experience with TaxCut. I'm even happier that you received a nice refund and are taking your wife out to dinner twice this week! LOL Enjoy.

Beverly said...

I've been looking over properties lately, with an eye toward investment and rental income. After reading your post, I might do more extensive background checks. Or, at least require a credit check. That's standard in most places now. Thanks for the info. Really good article.