Taxpayers may be less desperate than last year to receive and spend their tax refund checks, according to one analyst's review of Treasury data.
Every year, most tax filers receive a refund, and whether they're planning major purchases or paying off bills, many are usually eager to spend them.About half of the average $2,800 refund check per household is usually spent soon after it's received, according to ConvergEx Chief Market Strategist Nicholas Colas.
Yet, year to date, the dollar amount in tax refunds issued is $10 billion short of the average year, and more taxpayers appear to be filing for extensions.
According to Yahoo! search trend data, searches for the term "tax filing extension" are up 280 percent in the past 30 days compared with the same period a year ago. Meanwhile searches for "where's my tax refund" are down 31 percent year over year.
And those later-than-usual tax filings have broader implications for the overall economy. Generally, most tax refunds are issued in the first quarter of the year and that money is spent in the first quarter, Colas explained.
But since more refunds than usual will be issued in the second quarter, or later because of filing extensions, more clothing, appliance and even car purchases may have been delayed. That could mean better news for companies later this year, Colas added.
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