Quick tax rebate questions

[Fabian]

Ever since I turned 18 and done my income taxes, I've been going to the same guy my family was using for years. As a single bachelor with no kids, I generally got about $600-$800 on my return which I thought was normal. On paper my taxable wages were about $25,000.

Now there are some coworkers I have (single and no kids) who go to some tax guy who specializes in waiter taxes and they have always gotten around $3,000 back every year. Is this a bit much or was I just being ripped off every year?

[K'Nort]

When I was making about that much and didn't have anything unusual to adjust, I usually got about $1,200 back.

My understanding is that waitstaff taxes are a pretty unique system though. Sort of like with the self-employed.

I wouldn't make any assumptions about the $3,000 guy without finding out what's normal from a third tax professional. With just two data points, there's an equal chance of either one of them doing it incorrectly.

[LtMarvel]

Waiters have to be honest about those tips. :)

Tax refunds have more to do with have much you have withheld from your paycheck vs your tax bill. You filled out paperwork with your employer which determines how much taxes are withheld (you can even ask your employer to withhold more--a good idea after any year you owe the IRS instead of getting a refund!). The summers I used to work as a dishwasher in a fancy restaurant, I noticed that most of the waiters' biweekly paychecks were for $0.00--they made so much money in tips that the IRS got their entire hourly wages!

[Shellhead]

I haven't professionally prepared tax returns in years, but it's still true that a tax refund isn't really a thing to brag about. It means that you gave the government too much money during the years, and they finally paid it back without interest. Give me $600 right now, and I would be happy to send you back that $600 in April 2012. Heck, I'll even in give you an extra $1, which is more than you will get from the IRS.

If your fellow waiters are getting $3,000 back in refunds for comparable wages to yours, it means that this shady accountant is helping them cheat on their taxes, or else they are having twice as much tax withheld from their checks. Don't cheat on your taxes, you can get in serious trouble. Ask Willy Nelson or Wesley Snipes.