Mama, Get those Taxes DONE!

Are you procrastinating filing your taxes? Here are 3 Reasons to File Your Taxes NOW:

If you owe, you have time to plan

Many individuals and business owners avoid filing their taxes because they are afraid they will owe money. My theory says if you don’t know, you can’t plan. 

One year my husband and I owed $9000 in taxes. My business income grew and we didn’t adjust my husband’s withholdings on his paycheck. However, because we did it early, we were able to plan out how we would pay the $9000 before the tax deadline, avoiding the hassle of filing an extension, requesting a payment plan and paying interest on top of what we already owed.

Additionally, due to the pandemic, families have received multiple stimulus payments that can help cover owed taxes.

If you overpaid, you have extra funds to reinvest

Before we discuss reinvesting your funds, keep in mind that a tax refund is not a bonus from the government. It is tax money you have overpaid during the year that the government is returning to you.

In other words, you are receiving what you would have otherwise had in your bank account during the year.

When I taught personal money management, I encouraged my clients to plan the use of their refund. Oftentimes we spend during the year in anticipation of receiving that tax refund, hoping to catch-up with the added debt created. 

Rather than catch-up, find a way to reinvest your tax refund to grow your business, pay off existing debt, or take a vacation. There is no one specific avenue that is best for every person, but an intentional conversation with your spouse and family can help steward that money in ways that will guide you further to your goals.

Peace of mind that a big task is done

As the tax documents come in the mail, are you filing them? And where is that file? Is it somewhere you see daily, or is it hidden away in your filing cabinet? Whether you can see it or not, your brain still knows it’s there. 

I love doing our taxes in January because when that important task is done, my brain cells can focus their energy on caring for my family and growing my business. For many families, especially those that receive a W2 from your job, taxes are actually pretty simple and there are great online platforms to complete them yourself. 

The reality is you have to complete them at some point. As kids, mom wouldn’t let us leave the table until our vegetables were eaten. The longer I waited, the taste of the vegetables didn’t change, but the enormity of the challenge grew in my mind. Get your taxes done and your physiological self will thank you for it.

If you have any questions regarding my suggestions above, leave a comment or send me an email. I would love to hear from you.

Helping you find the story in the numbers,
Heather