When you owe the government money they want interest.

But they are exempt from paying you interest... Yet many still give them interest free loans every two weeks.

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Our income tax system is nuts. They take a cut from each pay check. You may have to pay quaterly taxes. At the end of the year, we true up. If you didn't pay enough taxes, you owe. If the amount you owe exceeds a certain threshold, then you weren't paying enough as you went along, so you not only pay your taxes, but also interest and penalties. If you paid too much, you've given the gov't an interest free loan.