Dee is right. I have my w2 set up in a way that when I did my taxes this year I am getting back $420 from the feds and I owe the sate $380. So I will be netting a profit of $40. Its way better for me to have the extra $100 a paycheck every 2 weeks and do with that money what want then to get a $2600 refund at the end of the year and let the FEDS use my money interest free. So basicaly in my scenario I am throwing away about $100 in interest if I were to get the refund at the end of the year instead of every paycheck at a modist 3%.