New Tax Survey Finds Millennials & Men Are Most Likely to Be Overconfident in Their Tax Knowledge

JERSEY CITY, N.J., April 28, 2021 /PRNewswire/ -- As the deadline to file your 2020 taxes approaches, a new Credello survey suggests that millennials are overly cocky about their knowledge of taxes when compared with Generations X and Z. The survey also found that, irrespective of age group, men are more self-assured about their tax expertise than their female counterparts. However, females scored higher on tax literacy across all age groups.

Key insights include:

• 83% of millennials claimed to have adequate tax knowledge but 32% scored a B or lower on a simple tax literacy quiz
• 34% of men claimed to know everything about taxes compared with 23% of women, but women generally scored higher on the same quiz
• More than half of respondents don't understand how marginal tax rates work
• More than a third of respondents are confused about which deductions they can claim

The online survey of 1,000 Americans ages 18–56, conducted on April 18, 2021, asked respondents nationwide a series of questions about taxes, including how they handle deductions, factors that influence how they file, their biggest tax fears and questions, and what they typically do with their tax refunds.

Overall, Americans surveyed are fearful of finding out they owe money to the IRS (31%), not maximizing their refund (22%), and making a costly filing error (22%). By comparison, people are much more concerned about the financial impact of their taxes than any potential privacy issues. Only 7% of respondents claimed that getting their identity stolen would be scarier than missing out on refund money or giving the IRS a reason to come knocking.

When asked what they typically do with their tax refund, 29% of respondents said they use it to pay off debt, while 18% put it into savings, 17% use the money for living expenses, 12% invest, and 10% spend it to treat themselves.

Additional highlights from the Credello survey include:

• 68% of respondents claim the standard deduction, while only 21% regularly itemize
• 63% of respondents spend $100 or more doing their taxes each year
• 54% of respondents try to file their taxes as early as possible, while 15% put it off until the last minute
• 44% of respondents (and 56% of men and Gen Z respondents) thought they could claim a pet as a dependent
• Family (35%) are the biggest influence on how people do their taxes, followed by online resources (19%), friends (15%), and social media (13%)

As a whole, the survey data suggests that there is an opportunity for Americans of all ages—especially millennials—to learn more about taxes and fill those knowledge gaps before the 2021 tax season rolls around. A little humility wouldn't hurt either, perhaps.

About Credello
Built for millennials, Credello is a user-friendly platform that simplifies financial decisions by providing personalized, on-demand recommendations for debt consolidation, personal loans, and more—so users can choose the best solution with confidence.

When using data in this survey, please credit Credello with link to: www.credello.com/financial-resources/millennials-and-taxes-survey/

Contact:
Jen-Ai Notman
[email protected]

SOURCE Credello

Related Links

http://www.credello.com/financial-resources/millennials-and-taxes-survey/