Welcome to 2021! That means that the 2020 fiscal year is over. While there’s nothing fun about filing tax returns or paying taxes, taking steps in January to organize your paperwork could help you avoid getting frustrated, frazzled, or befuddled come tax time. Here are 5 things you can do now: 1. Make a copy …
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Welcome to 2021! That means that the 2020 fiscal year is over. While there’s nothing fun about filing tax returns or paying taxes, taking steps in January to organize your paperwork could help you avoid getting frustrated, frazzled, or befuddled come tax time. Here are 5 things you can do now:
1. Make a copy of last year’s tax return and attachments. With this to guide your tax prep, you’re less likely to forget a source of income or a deduction.
2. Collect the tax IDs you’ll need. This includes your dependents’ Social Security numbers and the SSN of anyone you employed (e.g., a babysitter, housecleaner, or nanny).
3. Create a file folder labeled “Income”. Use this folder to organize the following tax forms you should receive in January or early February:
4. If you typically itemize your deductions, start another folder labeled “Deductions”. Some of the information that goes here will come by mail; the rest you may need to supply yourself.
5. Rev up your retirement saving. There’s still time before the April filing deadline to contribute to a Traditional IRA or Roth IRA. For details, search “IRA Contribution Limits” at www.IRS.gov. Don’t have an IRA yet? Ask us about our insured IRA options.
Compass Community Credit Union does not provide tax advice. We recommend consulting a qualified tax professional to determine how tax laws may apply to your situation.
April is the month when Americans get one of two bits of news. We write a check to pay our taxes, or we get a check written to us in the form of a tax refund. If you’re one of the nearly 80% of Americans who receive a refund on your federal income taxes, congratulations! Now, what to do with the unexpected windfall?
It’s not sexy, it’s not glamorous, but an emergency fund is essential. The days of working 40 years for the same company are behind us, so an emergency fund is a vital tool to manage a job loss or to cover an unexpected medical or home expense.
Maybe you didn’t have an emergency fund when you needed it…and you had to finance day-to-day living on high-interest loans or credit cards. Use your tax refund to pay down or pay off that debt. Dollars used today to pay down high-interest debt can save you thousands of dollars in the future.
Every day, you are inching closer to retirement. So, what’s your plan? If the answer is “Social Security,” or, “Not sure,” well, put your refund to work on a retirement fund. At CSFECU, Roth or Traditional IRA Certificates can be opened with as little as $100.
Seeing a pattern here? Deferred gratification. Put some of your tax refund away for that new car, new computer, self-improvement classes…
We aren’t heartless! Yes, if all the basics are covered, take some of your refund and do something for yourself, for today.
Happy tax day!
In short, a credit union is a cooperative financial institution where people work together to make everyone’s lives better. Everyone who has an account here is a member. And every member is an owner.
Rather than making profits to send to far-off shareholders, Compass CCU reinvests in our credit union. Which means we reinvest in YOU. That’s why we say that, at Compass Community Credit Union, we guide you to better banking.