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  • Putting America Saves Week Into Action– Step 5: Save at Tax Time

    For my last blog for America Saves Week, the theme is “Save at Tax Time.”

    One simple way to save is to put away that tax refund. Resist the urge to spend it all and instead put some of it in your savings account or retirement fund. The IRS makes saving during tax time pretty simple. There is a specific form, an 8888, which allows you to split your refund between two accounts.

    I filed my taxes several weeks ago and already received my refund. Many people treat their tax refund as a windfall of money and spend it immediately. WISER instead encourages saving during tax time as it is a perfect time to add a little more to your savings. So when I filed my taxes, I sent my refund to my savings account. I choose to save all of my refund, partly because it was a pretty small amount to start, but also because I would rather have that money for a rainy day than splurge on something I do not absolutely need.

    Another great way to save at tax time is to make sure you get all the tax credits for which you are eligible. Common tax credits that are often overlooked by many who are eligible is the Saver’s Tax Credit and the Earned Income Tax Credit.

    While I do qualify for those tax credits, I did learn that I qualify for Free File. Free file allows tax payers whose income is below $58,000 to file taxes for free. The IRS links to professional software programs that assist you while completing the paperwork.
    Filing online worked for me because my taxes are pretty simple and I am very comfortable with technology, but if you do not think this is the right option for you there are other resources available to help during tax time. Many local libraries and other organizations particiapte in Volunteer Income Tax Assistance, which provides free tax help if you meet certain income requirements. If you are 60 years or older, you can also participate in the Tax Counseling for the Elderly Program, which specializes in questions about pensions and retirement issues that are unique to seniors. You do not have to face the complicate issue of taxes alone

    For more assistance tools, take a look at this website.

    Make sure you ask whoever helps you file your taxes how you can send part or all of your refund to a savings account or retirement fund (like that IRA we talked about setting up yesterday!).

    Thanks everyone! It was great going through the steps of America Saves Week with you! Keep on saving!

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    WISER

    About Us

    WISER is a nonprofit organization that works to help women, educators and policymakers understand the important issues surrounding women's retirement income. WISER creates a variety of consumer publications including fact sheets, booklets and a quarterly newsletter that explain in easy-to-understand language the complex issues surrounding Social Security, divorce, pay equity, pensions, savings and investments, banking, home-ownership, long-term care and disability insurance.

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