A survey of 1,000 adults was commissioned by H&R Block and conducted by the Gallup Organization between Nov. 11 and Dec. 2, 1999. Among the findings are the following insights into Americans' preferences and behaviors related to tax refunds. These findings are based on the responses of adults between the ages of 18 and 64, who reported filing a tax return last year, and reported annual household incomes of $20,000 or more. Detailed statistical tabulations for each of the findings are available. Large Majority Receive Tax Refund Approximately three-quarters (73 percent) of adults said they received a tax refund last year, while one in four (26 percent) report that they did not receive a tax refund. Tax filers under age 50 were more likely than those age 50 and over to say they received a tax refund last year (80 percent vs. 58 percent).
Spending, Saving, and Investing
Respondents who said they received a tax refund last year were asked what they typically do with their tax refund. Four in ten (40 percent) said they paid bills while 36 percent said they added to their savings. About one-third (34 percent) said they usually spend at least a portion of their refund either on a major purchase like a home, car, or appliance (13 percent), something special or fun (11 percent), or on travel (10 percent). One in eight (12 percent) who received a tax refund last year say they typically invest the money. (Respondents were allowed to give more than one answer.)
Acting Quickly
Asked how long they wait until they spend or invest their tax refund, the majority (69 percent) say they wait no longer than 30 days. This includes 38 percent who say they use the money within seven days or less, and 31 percent who estimate they use their refund within two to four weeks of receipt.
Attitudes Toward Tax Refunds
Of those surveyed, nearly half (46 percent) look at tax refunds as a forced savings plan that prevents them from spending the money during the year. The other half (49 percent) say they would rather have this money to manage during the year rather than receive a tax refund. Women are more likely than men to look at tax refunds as a forced savings plan (55 percent vs. 40 percent). Conversely men are more likely to say they would rather have the money during the year. Tax filers under age 35 also are more likely to see tax refunds as a forced savings plan (55 percent) while adults age 35 and older most often say they'd prefer the money to manage during the year (52 percent).
Sampling Error
The sampling error associated with the sample of 1,000 respondents is plus or minus three percentage points at a 95 percent level of confidence.
Courtesy of ARA Content, www.aracontent.com, e-mail: info@aracontent.com
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EDITOR'S NOTE: For more information contact Todd Ransom, H&R Block, at 816/932-8303, Neil Getzlow, H&R Block, at 816/932-4886 or Carrie Reetz, Fleishman-Hillard, at 816/512-2337.
Founded in 1955, H&R Block Inc. is a diversified company with subsidiaries providing a wide range of financial products and services. H&R Block Tax Services Inc. served 18.9 million taxpayers in more than 10,000 offices located primarily in the United States, Canada, Australia, and the United Kingdom in 1999. H&R Block Financial Advisors and Olde Financial Corporation provide consumers with financial planning and investment products. Option One Mortgage Corporation, Assurance Mortgage Corporation of America, and H&R Block Mortgage Company offer a full range of home mortgage products. Through RSM McGladrey Inc., and HRB Business Services Inc., the company has built a national accounting, tax, and consulting firm. Block Financial Corporation offers consumer financial products and services, including online tax preparation over the Internet. Quarterly results and other information regarding H&R Block are available on the company's Web site at www.hrblock.com.
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