Taxes may be a little different this year. Spending a refund wisely is as important as ever.
If you have received or are going to receive a tax refund this year, it may be more important than ever to plan how to use it. To help you in these times of uncertainty, here are some tips for what to do with your tax refund.
1. Be aware of federal income tax changes. The federal government has made some changes to this year’s tax season in response to the emergency. While the details were still being worked out at the time of writing, one change is that the deadline for tax filing and payments will be pushed back from the normal April 15th deadline. If you owe taxes, you’ll have at least an additional 90 days to make payment. (Read the official IRS statement here.) But be mindful that your state tax returns may still be due at their normal deadline. Make a habit of visiting the official IRS website regularly, as other changes to the tax filing or payment requirements may change rapidly in response to the crisis.
2. Use your tax refund to pay bills. If you’ve been hurt financially by the pandemic crisis, your tax refund can help make ends meet. If you’ve had to dip into your savings due to disruption, your tax refund could help replenish funds.
3.Donate to those in need. If your finances are in a good place and you don’t personally have a need for the extra money, consider donating it to a charitable organization. Your surplus funds could help out people who’ve been harder hit by the crisis. But beware of scammers. Here are some tips from the Federal Trade Commission to help you avoid scams.
Now more than ever, it’s important to spend your tax refund wisely. Be sure to read more BancorpSouth financial education articles to help you make smarter spending, saving and investing decisions. We’re Right Where You Are.
© BancorpSouth 2020
