A Noun is the Name of a Thing

I signed on with H&R Block to be a tax preparer this year. I did it both for the experience, which I figured would help with my own taxes, and because I hoped to make a little extra money. As a first year preparer, it turns out I was wrong about making any real money, but that is a topic for another post.

So I have been working part time the last two weeks doing taxes, and have done about 20 returns so far. Most of the people who file early are getting big refunds, but I didn’t realize how big until I started processing their taxes. The vast majority of the tax returns I’ve done have gotten way more money back from the IRS then they paid in withholding.

The language we use around taxes is completely misleading. Take someone who pays $2000 in withholding and gets all $2000 back, plus another $3000 in top of that. Should we be calling that a tax refund? Normally a refund is the return of money paid in. The return of withholding counts as a refund, but what about the other $3000? Instead of calling that part of their refund, wouldn’t it be more accurate to call it welfare?

At an even more basic level, why are we calling everybody taxpayers? Half the households in America pay no income tax. A more accurate term would be tax filers. Actually, if you get more tax money out then you pay in, doesn’t that make you a tax receiver?

I'm not done with the subject of taxes, there will be more to come. By the way, my opinions are my own and in no way should be considered to represent H&R Block in any way.