3 Ways to Prepare for Next Tax Season

Tomorrow tax season is finally coming to a close. Believe it or not, it’s never too early to start thinking about next year. If filing your taxes was a headache and a hassle this year, here are a few tips to get you prepared for 2019.

Get organized: Did you waste a bunch of time looking for receipts this year? Create a system, whether it’s a file cabinet or a shoebox, and keep track of those receipts and other financial documents you may need at the end of the year. Keep a tally of your charitable and retirement contributions and you’ll be ready to go as soon as you get that W-2 in the mail.

Keep track of changes: What’s happened to you this year, and what will be happening in the next few months? Are you getting married? Having a baby? Buying a house? Opening up a Roth IRA? All of these things will affect your filing status, so make sure you’re up to speed on how any of things will affect your filing process.

Be patient: Do you have a side business or do freelance work? If so, any number of hiccups can occur during tax preparation. Be prepared – but know it’s not a huge deal if you have to file an extension. If you find yourself in this boat, head on over to IRS.gov and get an extension form.

With a little preparation, you can make the tax season process a lot easier.

Article Source: John Pettit for CUInsight.com

 

Important Member Alert: Tax Scams

We are in the midst of tax season, and you guessed it – the fraudsters are at it again! Please be on the lookout for the following tax scams, where the scammers have been posing as the IRS via phone or email. The most important thing to remember here is that the IRS will never contact you via phone or email.

Click here to watch a short video from NBC Nightly News, which explains some of the recent tax scams.

In the first tax scam scenario, fraudsters will have already obtained an individual’s non-public personal information (name, SSN, date of birth) and bank account information. They may have obtained this information in many different ways (dumpster diving, computer hacking, stolen wallet, pretext calling). They will then file a false tax return using the individual’s name and information. Once they receive confirmation that the tax return has been deposited into the individual’s bank account, they will contact the individual via telephone posing as an employee of the IRS. They will state the funds were deposited to their account in error and order them to pay the funds back or suffer penalties.

In the second tax scam scenario, a fraudster will contact an individual via phone or email, again posing as a representative from the IRS. They will state that they owe back taxes and demand payment from the individual. They will attempt to obtain the individual’s checking account/bank routing number or credit card information to directly debit their account, or they may instruct them to mail a check.

Once again, the IRS will never contact anyone via phone or email – they will only use regular US postal mail. If you receive a phone call or email from the “IRS” – it is not the IRS.

Have you received a tax refund you didn’t file for yet?

  • Contact your financial institution immediately.
  • Have your financial institution return anything direct deposited into your account to the IRS, and then call the IRS at 1-800-829-1040
  • For an actual check received in the mail, write VOID across the front of the check and mail it to the IRS location closest to you by entering your zip code at IRS.gov
  • If you cashed the check, you will need to reimburse the IRS with a personal check.
  • For further instructions, visit the tax fraud section of the IRS’ website here.

If you feel that any of your First Financial accounts may have been compromised as a result of a tax scam, please contact Member Services at 732-312-1500 Monday through Friday 8am-6pm EST, or Saturday 8:30am-1pm.

Article Sources: NBC Nightly News and IRS.gov

4 Smart Ways to Spend Your Tax Return in 2017

Tax form with paper money, silver pen, calculator on white background

Here are some smart ways to spend your money once you get that tax return this year.

Pay down credit card debt. This may be the smartest choice when deciding what to do with your refund. Decreasing your debt helps alleviate the interest you’re paying, which will be a huge weight off your wallet and credit score. Debt can feel like a mountain, so take the opportunity to dig yourself out from under it.

Debt overload? Check out First Financial’s free, online debt management tool, Debt in Focus. In just minutes, you will receive a thorough analysis of your financial situation, including powerful tips by leading financial experts to help you control your debt, build a budget, and start living the life you want to live.

Put it into retirement. Your retirement account (401k, Roth IRA) can sometimes be neglected if you’re not steadily adding funds, so use your refund as a chance to jump start your contributions for 2017. It may not seem super important now, but you’ll be retirement age before you know it.

Questions about retirement savings or investments? To set up a complimentary consultation with the Investment & Retirement Center located at First Financial Federal Credit Union to discuss your savings goals, contact us at 732.312.1564, email samantha.schertz@cunamutual.com or stop in to see us!*

Build that emergency fund. Even if you’re doing a good job of saving for retirement, that may be all you’re saving. If this is you, use your tax return to create an emergency fund in case things go south. It’s never a bad idea to be prepared!

Invest in yourself. This could have a lot of different meanings. Exercise is good for your body and taking a trip can be a good way to unwind and refresh your mind. If these sound like good ideas, join a gym or book a flight. Have a favorite charity? Give some of that money away. Helping others can be good for the soul too.

*Representatives are registered, securities are sold, and investment advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor, 2000 Heritage Way, Waverly, Iowa 50677, toll-free 800-369-2862. Non-deposit investment and insurance products are not federally insured, involve investment risk, may lose value and are not obligations of or guaranteed by the financial institution. CBSI is under contract with the financial institution, through the financial services program, to make securities available to members. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.

Article Source: John Pettit for CUInsight.com

3 Ways to Ensure Cyber Safety During Tax Time

Income Tax File Meaning Paying Taxes 3d Rendering

The IRS is now officially open for business as tax season gets underway. Here are three ways you can protect yourself over the next few months as you manage important and sensitive, financial documents.

Stay on secured networks: As with other financial transactions, make sure to only e-file your taxes (or view private documents) on a protected Wi-Fi network. You may be tempted to work from a coffee shop or the library, but remember using a public server can make you an easy target for cyber thieves.

Beware of IRS emails: The Internal Revenue Service will never directly reach out to you; if you receive a fraudulent message report it immediately to phishing@irs.gov. Use caution when dealing with these and be sure not to click on web links or open suspicious email attachments.

Set strong passwords: Most of us may think that choosing a password such as “password” or “123456” is an obvious mistake but according to TIME, these are in fact the most popular password picks. Review their list of these commonly used passwords and make necessary adjustments to yours to ensure your information stays safe online.

Remember, due to a holiday in Washington, DC – the tax deadline this year is April 18, 2017.

First Financial members get discounts on TurboTax products – get started today!

Article Source: Wendy Bignon for CUInsight.com

5 Reasons You Should File Your Taxes Early

Printed copy of Form 1040 for income tax return with reminder for April 18 deadline

You’ll get your money as soon as possible.

This one may seem obvious. The sooner your file for a refund, the sooner you’ll get it back. The closer you wait until Tax Day, the busier the IRS is, and the longer it’s going to take to get your money back.

You can prevent your return from being stolen.

Criminals would love to have your tax return, so filing quickly will give them less opportunity to commit fraud and steal your money.

You’ll be less stressed.

The 2017 tax deadline is April 18th. If you find out your taxes are going to be more difficult than past years, you may find yourself scrounging around for paperwork and the process may take a lot longer than you planned. By filing early, this date shouldn’t be a source of stress for you.

You’ll have more time if you have to pay.

Hopefully you’re looking at a refund this year, but if not, you’ll have to be paid in full by April 18th. If this is the case, you’ll give yourself more time to pay by filing early. Think about that if you know you owe money this year.

Tax pros are less busy.

Not only is the IRS less busy at the beginning of the year, but tax professionals are as well. Keep this in mind if you’re not filing on your own. For those of you who file online, this won’t be a big deal, but if you need a pro to help sort you out, you’ll be glad you made an early appointment.

First Financial members get discounts on TurboTax products – get started today!

Article Source: John Pettit for CUInsight.com

How to Get Ready for Tax Season

Tax Forms

Make a list of major life changes.

Getting married, having a baby, buying a house, or a death in the family this year means that your tax situation is probably going to change. Make sure you fully understand how these events are going to affect you now to offset any tax increases that you may experience.

Make a tax folder.

Shortly after the first of year all of your tax documents are going to start rolling in. When they do, put them all into one place. Even before those W-2s or 1099s show up, gather all of the receipts from your tax-deductible expenses and donations.

Decide if you are going to go it alone.

If you are going to file yourself, the best time to get a deal on the updated tax software is right after the first of the year. The longer you wait, they more expensive it could be, so make sure you aren’t missing out. If you are going to use an accountant, you should be scheduling an appointment now.

First Financial members get discounts on tax software from TurboTax. Get started today!

Know how to file for an extension.

Sometimes it can be difficult to find all the right documents before the deadline (which in 2017 is going to be April 18th). All you need to do to receive an extension is fill out and submit Form 4868, though the IRS will not be ready to process these forms until March at the earliest.

Educate yourself.

Last year a NerdWallet survey found that the average American scores a 51% on personal finance questions related to US federal income tax returns. Most of the questions missed had to do with how retirement accounts, college savings and healthcare can affect your tax return. Take some time to fully understand all these factors so you can be sure to get your largest return in 2017.

Article Source: Tyler Atwell for CUInsight.com