Planting Seeds . . . in December

Regardless of your political leanings or feelings toward how we got to this point in our economy, it’s estimated that the average American taxpayer will see a 26% increase in their tax return (or 26% decrease in what they owe) for 2018.  This little nugget of statistical wisdom comes courtesy of the party animals over at Morgan Stanley.  (Word to the wise: hide the lampshades when you invite them over to the house for your annual holiday fete.)

According to a quick Google search, the average tax return last year was just shy of $2,800.  This means that a 26% increase will put the average tax return for 2018 at just over $3,500.  For those of us who don’t light cigars with $100 dollar bills, I wouldn’t mind an extra seven Benjaminscoming back to me!

Yes, there are many financial professionals and pundits who write endless articles and wring their hands on cable news programs over how stupid it is to give your money to the government as an interest-free loan for a year so you can get a return when you file your taxes.  In theory and principle, they couldn’t be more right.  However, the reality is that most of us hate OWING money at the end of the year, so we overestimate what we have deducted from our paychecks to make sure we don’t have a bill staring us in the face on April 15th.  The tax code is thicker than all the books we were required to read in junior high and high school combined.  Don’t get all worked up, financial folks, over the fact we’d rather spend our weekends binge-watching something on Neftlixthan poring over spreadsheets and algorithms to figure out the exact amount of money we should deduct so we’re “even” with Uncle Sam at the end of the year!

If you haven’t already, you may be asking yourself at this point in this week’s newsletter, “Why are we talking about taxes in December?”  Two words: preemptive strike.  (No, I’m not talking about toilet papering the neighbor’s house before he can get yours.) Employers will be sending out W2s next month, so now is the ideal time to plant the seed with potential homebuyers that their tax return could be the perfect source for all or a part of a down payment on a house.  While other real estate agents are busy posting photos on Instagram and Facebook of their Schnauzer dressed as Santa Paws or their Calico, Mrs. Finickypants, wishing you a Meowy Christmas, reach out to your prospective clients with posts about getting into a home after the first of the year with their tax returns.

We’re two weeks away from Christmas and three weeks from New Year’s.  Most folks aren’t kicking and screaming to go look at houses at this very moment. Spend some time getting creative to plant seeds for the beginning of the year.  If you want to get cute, have Santa Paws and Mrs. Finickypants holding a W2 and a 1040 form in the accompanying photo.  It couldn’t hurt (unless Mrs. Finickypants is fond of scratching).

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