Most people say they plan to use this year’s tax refund to pay bills, deciding in this sour economy to be more frugal with their annual windfall.
Fifty-four percent of those receiving refunds said they intend to pay off credit card, utility, housing and other bills, according to an Associated Press-GfK poll released today. That compares with 35% who said the same thing a year ago. Only 5%, about the same as a year ago, said they planned to go on a shopping spree.
The survey found that 38% of those receiving a refund say they plan to spend at least part of it. But the spending appears to be mostly on basic needs: 17% say they would use the money for everyday needs such as food and clothing. It was 7% a year ago.
The deadline for individuals to file their 2008 tax returns is Wednesday. As of last week, the Internal Revenue Service had sent out about $200 billion in tax refunds. Commissioner Doug Shulman says the agency expects to send out about $330 billion by the end of tax season.
The AP-GfK poll found that 57% of adults said they expect to receive a tax refund. The average refund this year is about $2,700, compared with $2,500 last year, Shulman said.
