By: First Union
Some Money-Saving Moves for Your Taxes
Tax day is less than two weeks away. Due to the crisis, this year's deadline was moved from April to July. Good news for many, not to mention it has given people a bit more time to figure out ways to save on this year's returns. July 15th is also now the last day to make contributions to tax-advantaged accounts as well. So do keep that in mind as you prepare your 2019 taxes.
Remember those IRA contributions
Whether a traditional IRA or a Roth, you can contribute up to 6k. If you're over fifty you can also add an extra 1000.00 to the account. Given where your income stands, you may be eligible for a tax deduction on the pretax money you contribute to the retirement fund.
Look at your health savings account
If you happen to have a high deductible plan and have an HSA set up, you can add up to 3500.00 to your HSA. For family plans that number is 7000.00. And for those 55 plus you again can contribute an extra 1000.00. All HSA contributions of this nature are in fact deductible. Because of the extended deadline, you have up until July 15th to make these deposits into your HSA account.
Set up a payment plan
If given the current circumstances you're not prepared to file by the 15th, you can file an extension which would then give you until Oct. 15th. That said, you still will have to pay whatever taxes you owe by the fifteenth of July. Because of what has been going on and where the economy stands, the IRS does understand this may be difficult for some people. By going on to IRS.gov, you do have the opportunity to set up an installment plan to pay any back taxes owed. There is also the offer in compromise option which would allow you to come up with a settlement agreement if the IRS accepts your application.
Earn interest on any refund you have coming
If you are actually due a refund, you can file by the 15th and consequently be paid interest compounded daily from April 15th. Up until June 30, that rate was 5%. Until Sept. 30, it is now at 3%. The interest payment you do receive comes separate from the actual refund. And it is considered taxable income for your 2020 returns.
First Union Lending has been helping small businesses weather this crisis. With short term loans, lines of credit, and merchant cash advances among other such solutions, we are working hand in hand with clients to ensure they survive and come out of this strong. Even if your credit score is less than stellar, we likely still have a funding option that can work for you. Some even receive the cash in their accounts within as little as two days—we do work that quickly. Call today and let's get started on this journey together!