It's income tax season, and people are looking for answers. Frequently, they turn to social media, particularly Facebook. I feel like I have spent all day answering income tax questions on Facebook.
One thing has jumped out at me: the misuse of the word return when talking about income taxes. In particular, many people refer to their income tax refund as a tax return. It may seem silly, but if you are using the word return incorrectly, then you might not understand the income tax process. That's not good for many reasons.
In the United States, our income taxes are calculated on a calendar year basis. At the end of the calendar year, you figure out how much income tax you owe for the year. You do this using a form called an income tax return. Per Merriam-Webster, a "return" is "an account or formal report." Your income tax return is the formal report of your income, an account of the tax laws as the apply to you, and calculation of taxes due for the entire year.
Over the course of the year, you have had income taxes withheld, or taken out, of your pay. If the amount of taxes withheld throughout the year is more than the total tax due for the year, then you will receive a refund of the overpayment of taxes. If the amount of taxes withheld throughout the year is less than the total tax due for the year, you will be required to pay the difference.
Using the word return when you mean refund may not have any terrible results, but it may cause some confusion. This is especially true if you are talking to someone about your income tax return, such as your tax preparer or the Internal Revenue Service (IRS.) It's such a small thing to use the words correctly, and it could save you time and trouble.
