When you get your refund from Uncle Sam, consider using it to fund a home improvement. As your biggest asset, your home is a worthy place to invest your extra dollars.
Money laundering is something you want to stay away from, but investing money in your laundry is a good idea. A new washing machine will pay off immediately in reduced energy bills, as much as $135 a year. In addition, there are often rebates available from the manufacturer, the utility company or state governments. A high-efficiency washer will cost between $700 and $900, making it a good investment for a $1,000 tax refund.
You could also use your windfall to help make your mortgage disappear. Even if you have a 30-year mortgage, applying small amounts of extra money can do a lot to pay it off early, saving thousands of dollars in interest. Paying an extra $1,200 a year on a 6% fixed-rate, 30-year mortgage of $250,000 would save you $52,000 over the life of the loan and pay the mortgage off 4 years early. Use your tax rebate to make an extra payment, and you will be moving closer to actually owning your own home.