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<I was just curious as to how this happens.>

There are just too many reasons that it happens. As other posters have mentioned, others just over-withhold, and/or have some other circumstances that are usually not so appealing.

Remember that every person/couple is different. Some have "too many kids" in relation to their income. Believe me, you don't want to qualify for the earned income credit because it means, unfortunately, that you are earning virtually poverty level wages and you are supporting someone.

Many people have mortgage interest, etc. to deduct, then fail to adjust withholdings.

Some are one-earner families; some have huge stock losses. The list goes on.

For your dual-income situation, your combined wages may be "underwithheld" due to your respective employers only having knowledge of your individual incomes and withholding accordingly. A form W-4 that figures for dual income seeks to address that when figuring exemptions.

I agree with the other posters that you shouldn't give the Dept of Treasury a free loan. So when the others are bragging about their refunds, just smile and know that you are doing great, and (not wishing this) that many of them are living check to check the rest of the year.

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