Hard financial year? That may lead to procrastination on filing taxes
People upset about stocks declining or in denial about their financial standing may wait until close to April 15 to file their federal tax returns.
“Psychology can play a larger role than economics in determining when a person files,” says Dr. H.M. “Monty” Evans, a psychologist at UT Southwestern Medical Center.
Research shows that most people file taxes based on how much cash they have on hand and if they expect a payment or a refund, Dr. Evans says.
“Those with higher incomes tend to file later, particularly if they anticipate large tax payments, while those who expect refunds file earlier, especially if they think they will be getting large refunds,” he says.
If filing taxes make someone realize their negative circumstances, however, they might delay filing.
Those reasons may include:
- • being upset because stocks have taken a dip and you don’t want to face facts;
- • not wanting to be realistic in regard to personal finances, which filing taxes forces you to do;
- • anger toward bureaucracy, with resulting delay in filing because you don’t want to “pay the government”; or
- • not wanting to be reminded of distressing personal issues, such as a recent divorce.
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UT Southwestern’s clinical services for mental health.