Tax Refund‘œNext to being shot at and missed, nothing is really quite as satisfying as an income tax refund. ‘“ F.J. Raymond

It’s refund time which happens to be my favorite money moment of year. Why? I’ve always received a refund’¦ big refunds, little refunds, and just about every amount in between. In the past twenty years, I can’t recall ever writing a check to the IRS.

I used to have heated debates when my sister, the CPA was my tax preparer. She’d always ask why I’d let the government have my money throughout the year. Many financial experts agree that if you’re getting a refund then you have given your money to the government interest-free for a year and this is just plain wrong.

But I beg to differ and here’s why: most people lack the discipline to save. Of course, I save using an automatic deposit plan. But I consider my tax refund a windfall (there are a few benefits of a windfall) and for some reason when it comes in a lump sum, it seems so much more satisfying and usable.

It all boils down to psychology, baby! The New York Times recently explained:

About three-quarters of the tax returns that the I.R.S. processed last year resulted in refunds. The average refund was more than $2,300.

You know what that means: the government had a lock on your hard-earned money, which you could have invested. (Given recent market volatility, though, it’s possible that you’ll be getting better results from the I.R.S. this year.)

But let’s not ignore the very powerful psychology of the tax refund. What joy to receive that lump sum and to deposit it into your bank account. (Less than half of taxpayers opt to have their refunds deposited directly, perhaps attesting to the visceral thrill of getting that check in the mail.)

If you had instead received an extra $44 in your paycheck every week, would you have looked at it the same way? Although the money was always yours, the refund seems like a windfall.

I’m not alone in my thinking. Last year, Rich gushed about his:

I know, I shouldn’t allow a big refund. I know, I should adjust my withholding. I know, it’s my money and I loaned it to the government all last year, interest free. Silly me! But I just love my tax refund.

Why? Because it allows me to do things I otherwise might not. My refund comes in a lump sum, and like other lump sums (bonus, extra paychecks, etc.) it’s out of the ordinary. It’s an occasion to be more thoughtful than if that same money came as a tiny trickle each pay period.

Irresponsible? Undisciplined? Maybe. But this is one case where I find a mind game with myself works better than careful, frugal, prudent planning each week. I am secretly saving all year, never missing the money, and then boom! Mid-February (at the latest) a nice lump sum lands in my checking account.

J.D. at Get Rich Slowly concurs when reporting on the size of his last year:

Already I can hear the sound of hundreds of heads thumping against hundreds of desks. Many of you are wailing, ‘œWhy?! Why?! Why?!’ Of all the financial choices a person can make, getting a large refund is universally considered one of the dumbest. Magazines advise against it. Books advise against it. Blogs advise against it. Yet every year, millions of Americans like me use their tax refund as a sort of forced savings account.

Why do we do it? Click over to read the pros and cons.

So on Friday evening, we’ll be heading over to see Don, our accountant. The fun thing about Don is that he actually does our taxes while we’re sitting there in real time. At the end of the three hours, he presses the button, utters his ‘œta-dah’ and the result usually prompts a group hug.

We love Don! To be honest, I think we’re his only lesbian clients and he finds the lifestyle to be mildly titillating. He’s an accountant for God’s sake. I would find our lifestyle titillating. What gets me more excited though is that big fat refund!

So what do you think? Refund or no refund? That is the question. I welcome your thoughts below.