What millennials plan to do with their tax refunds-By Maria LaMagna

Thinkstock

Millennials get a bad rap for not being savvy about money, but when it comes to filing and paying their taxes, this often-criticized generation is showing some positive behavior.
They “deviate from what I’ll call ‘popular cultural perceptions’ of millennials” when it comes to taxes, said Mark Steber, chief tax officer at Jackson Hewitt, a tax preparation company. “They’re a pretty savvy group as a whole.” Millennials make up the largest demographic of customers at Jackson Hewitt, he said.
And millennials are just as likely to say they should save their tax refund as other generations, according to a survey personal-finance company NerdWallet commissioned with Harris Poll, of more than 1,600 U.S. adults who filed taxes last year.
More than 400 millennials said they expected to receive a tax refund, and 54% of those who expect to get one said they believe they should save or invest it.
In comparison, 57% of those 35 to 44 years old said they think they should save or invest theirs, 50% of those 45 to 54 said they should, 46% ages 55 to 64 said they should and 61% of those 65 and up.
Still, whether they actually will save it may be a different question.
For example, 2,000 millennials that Carnegie Mellon University surveyed in 2014 said if given a $1,000 tax-refund check, they would be most likely to spend it, with saving coming in second as a popular answer.
The average tax refund across all age groups is $3,120, according to the IRS.
Of millennial men surveyed, 27% said they would spend the check on electronics, and 16% said they would save it. Of the millennial women, 18% said they would spend on clothing, followed by 13% saying they would save it.
About 90% of millennials said they file their taxes a full month or more ahead of the April 15 tax deadline, compared with 77% of other age groups, according to a survey carried out by market-research firm Instantly.
When it comes to the way they file, millennials seem to use software programs such as TurboTax (INTU)  or H&R Block (HRB)  about equally as much as older generations do; 36% of millennials use this method, compared with the average of 35% among all age groups, according to NerdWallet.
Perhaps surprisingly, millennials were the most likely in NerdWallet’s survey to say they mail their tax returns on paper; 17% of millennials and 8% of taxpayers 35 and older said they pay taxes this way. The IRS suggests that filing online can result in faster tax refunds.
Millennials may be turning to software programs and professional help to do their taxes and get them done early for good reasons: For one thing, they find dealing with taxes stressful, according to NerdWallet’s survey. About 80% of millennials in the NerdWallet survey said they were worried about making a mistake, not getting a full refund or paying too much.
While they are less likely than older generations to own homes or have children or hold complex investments that may complicate their taxes, younger workers can still have messy tax situations because they go through so many life changes, including frequently moving and changing jobs, Steber said.
Therefore, millennials should make sure they’re taking advantage of all the possible deductions, including the earned income credit (a tax credit for workers who earn less than $53,267), the saver’s credit (for those who make eligible contributions to their IRA or employer-sponsored retirement plans), the education credit (for those paying for their educations) and the premium tax credit, for those who buy health insurance through the Health Insurance Marketplace.

Culled from MarketWatch