The impact of the COVID-19 coronavirus is far-reaching, with news related to the pandemic filling the airwaves and pervading American lives with concerns for our health and financial wellness.
The financial health of this country is at stake. The government has stepped in to provide relief where possible, but charitable organizations are being stretched to provide services as contributions are shrinking and many families are concerned about funding such fundamental necessities as mortgages and food.
One area of relief for a family may be a refund from your federal income tax return. Have you filed your tax return?
File Your Individual Federal Income Tax Return Now:
For most taxpayers, the original due date for filing individual federal income tax returns was April 15. This is historically the deadline each year, and day that sees countless individuals completing income tax returns and rushing them to the post office to ensure that they are postmarked on time.
This year, due to the COVID-19 emergency, the U.S. Treasury extended the deadline for individual income tax returns and payments until July 15. If you owe taxes, this may benefit you.
However, if you are expecting an income tax refund this year, you should file your return as early as possible. Continue working with your tax preparer to submit your return now. The earlier you file, the sooner you will be able to use those funds to bridge any gap in income if the current economic environment negatively affects you.
E-file Your Tax Return:
One recommended option is using electronic filing for your return. Rather than filing a paper return and mailing it to the IRS, e-filing electronically transmits the return in a safer, quicker manner and allows your return to be processed faster. Your tax professional can e-file for you or you may be able to file yourself using a free portal found on the IRS website, using this link: https://www.irs.gov/filing/e-file-options.
Choose Direct Deposit for your Refund:
The most effective method to get your tax refund quickly is to have it deposited electronically into your financial account through direct deposit. This process is free, so you will not have to be concerned with the IRS charging for the service.
It is not difficult to ask to receive your refund by direct deposit. The secure process utiizes the same system the federal government uses to deposit the majority of Social Security and Veterans Affairs benefits into taxpayers’ bank accounts.
Combining direct deposit with electronic filing is the fastest way to receive your refund. Another advantage of electronic filing is that you can track your refund using the IRS Where’s My Refund? tool.
Avoid Delays in Receiving Your Refund:
To avoid delays in receiving your refund, double-check important information on your return before filing, including your Social Security number, bank account, and the bank routing number. If any of these numbers are incorrect, your refund will likely be delayed and require additional effort to track.
Before clicking the submit button when e-filing your taxes, choose to receive your refund via direct deposit. It is the fastest way to get your money and avoid the risk of having a refund check “lost in the mail.” Authorizing the IRS to deposit the refund into your bank account decreases the chances of an unsavory character stealing your check – for example, taking it out of your mailbox when it’s delivered.
The bottom line: Don’t delay filing your return until July 15 if you are expecting a refund. File now and put those funds to use for necessities if you are experiencing a shortfall in income. If you don’t need the funds now, build your cash reserve by depositing the money into your savings account to have it readily available should economic conditions remain strained for an extended period.
As we all work together to weather this unique and trying time in our history, planning ahead to meet financial obligations will remain a concern for many taxpayers. Managing your individual income tax situation may be one source of assistance.