What's your plan for the April 15 tax deadline?

Nearly seven of 10 taxpayers will get a refund, and the average refund for 2009 is up nearly 10% from last year to $3,036, according to the Internal Revenue Service (IRS). Eight of 10 people getting a refund say they will pay down debt, save, invest, or use it for everyday necessities, a telephone poll by Bankrate.com (April 5) revealed. Less than 10% plan to splurge on some extravagance.

And among the 24% paying the IRS this week, 60% will pay taxes with funds from their bank or credit union accounts, 6% plan to borrow money, and 17% say they intend to set up an installment plan to pay, according to the Bankrate survey.

That 70% of consumers pay more than they owe each month and will get a hefty refund suggests many need to adjust their income tax withholding, says Michelle Dosher, managing editor of Credit Union National Association's (CUNA) MoneyMix and Home & Family Finance Resource Center online money management tools for credit unions.

"A recent survey by the National Foundation for Credit Counseling found that 72% of 4,000 respondents preferred to have an extra couple hundred dollars in their pocket each month rather than a $2,400 refund once a year," Dosher noted. "People should recognize that a refund means you have overpaid your tax liability all year long." Too often, she said, those who overpay each month are the very ones who struggle to make ends meet.

"Consumers can adjust their withholding any time during the year," she advised.

For consumers getting a refund, Dosher offered these ideas:

• Adjust your deductible. Think about it. If you receive the average return of more than $3,000, you gave the federal government an interest-free loan of $250 per month.
• Pay down your credit card debt.
• Open an individual retirement account (IRA) or direct the amount of your refund you want going toward that option. With 54% of Americans having less than $25,000 saved for retirement, it's a great way to start saving. Only 3% of respondents to the Bankrate.com survey said they were going to have their refunds deposited into multiple savings options.
• Make energy-efficient upgrades to your home. Check energystar.gov to see which upgrades qualify for tax incentives.
• Pay down your mortgage or look into refinancing it. Your credit union professionals can help you decide which option makes more sense for you. Knocking $1,000 off your principal now will save significant dollars over a 30-year mortgage. Or look to refinance. Rates are still at historically low levels.
• Use the refund to bolster a down payment for a vehicle upgrade. Nationally, credit union rates for new and used vehicles are more than 100 basis points (or one percentage point) lower than bank rates, according to Datatrac, a rating service out of Milwaukee, Wis.