Top 4 Reasons to Offer a Tax Time PromotionFebruary 12, 2018
"The hardest thing in the world to understand is the income tax."
– Albert Einstein
But it’s not hard to understand why offering customers an incentive to spend their tax refunds is a good idea. American taxpayers have until April 17 to file their taxes, which leaves plenty of time to roll out incentives to help them spend their refunds.
We outline our picks for the top 4 reasons to offer customers a tax-related sales promotion. As a bonus, we end this article with a look at how consumers spend their refunds.
1: Rife Refunds
2: More Money
3: Fast Filing
Two in three taxpayers hope to file their taxes by the end of February, 2018. If they file as planned, that means 66% of taxpayers will likely have their refunds in hand by March 21 since the IRS says it processes 9 out of 10 refunds in less than 21 days.
Here’s when taxpayers planned to file in 2017:
• 22% before February
• 37% February
59% total planned to file by the end of February
• 26% March
• 15% April
4: Budge into Buying
Not everyone has a plan for their tax refunds. Almost half of those who expect a refund on their taxes in 2018 have yet to decide how to spend it. This is an increase in unplanned tax refunding—about 33% had no plan for spending their tax refund in 2017.
Bonus: Purchasing Plans
The priorities of those with refunds to burn falls into two categories: save or spend. Of those who have planned how to spend their refunds, more report spending than saving plans for 2018 compared to previous years.
• 40% paying off debt (loans, medical bills, credit card and other debt)
• 27% plan to purchase something, use for an event or travel
• 22% put in the bank
• 11% save for a specific goal (house or car)
The top 5 planned refund spending purchases from 2013 to 2017 (ranked most popular to least):
• pay down debt
• everyday expenses
• major purchase (furniture, TV or car)