9 Wise Ways to Spend Your Tax Refund

So, you followed our tax advice and were able to maximize your 2017 refund. You’re off to a good start, but what good is a big refund if you don’t spend it wisely?

While it may be tempting to take that refund check to the mall and spend it on a fancy new toy, you will thank yourself later if you exercise restraint and invest this money.

Here are nine smart ways you can spend your tax refund this year:

1. Re-invest the money in a retirement account. Roth IRAs allow your money to grow tax-free and have no minimum required distribution, making them a popular choice.

2. Pay off some credit card debt. Pay off your accounts with the highest interest rates first.

3. Make an extra payment on your mortgage. If you are lucky enough to have no high-interest debts, consider putting your money towards your mortgage.

4. Build your emergency fund. Your emergency fund should be able to support up to six months’ worth of living expenses.

5. Put it towards your next big purchase. Whether you have a new car or home improvement project on the horizon, your tax refund can be used to pay off a significant chunk of it.

6. Use it on your insurance policy. Upgrade your policy or just pay next month’s premium, the choice is yours!

7. Invest in your career with additional training or an industry conference. You are your own biggest source of income, so it makes sense to invest in yourself.

8. Make a charitable donation. Doing the right thing just feels good, plus it can reduce your taxable income for next year.

9. Treat yourself. There’s nothing wrong with spending part of your tax refund on yourself. The key word is part: try to limit this spending to 10% or less of your total refund.

Whether you are looking to maximize your tax return, or just need advice on spending it wisely, the financial consultants at American Investment Planners, LLC are here to help. To schedule an appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

5 Ways to Maximize Your 2016 Tax Refund

Tax season is upon us, and many Americans are looking forward to receiving their refund check. If you felt like you were shortchanged by Uncle Sam last year, here are five tips to help you maximize your return for 2016:

1. Start early. The best time to start filing your tax return was yesterday. The second-best time is today. Procrastinating leads to pressure as Tax Day draws near, and it is more likely you will make a mistake. Starting early allows you to take your time and be as thorough as possible.

2. Rethink your filing status. One of the first decisions you make when completing your tax return is your filing status. There are five statuses to choose from: single; married filing jointly; married filing separately; head of household; and qualifying widow(er) with a dependent child. 9 out of every 10 married couples file jointly, however, filing separately may yield a higher return depending on your circumstances.

3. Itemize your deductions. The standard tax deduction is $6,300 for singles and $12,600 for married couples filing jointly. These standard deductions can help lower your taxes, but taking the time to gather your receipts and make an itemized list may lower your taxes even further.

4. Claim credits. Credits are much more effective than deductions at reducing your tax bill and maximizing your refund. This is because credits are netted directly against the amount of money you owe, as opposed to merely reducing your taxable income. Available credits include the earned income tax credit, the child and dependent care credit, and education tax credits.

5. Max out IRA contributions. This tried and true strategy allows you to reduce your taxable income while simultaneously building your nest egg. 401(k)s and Traditional IRAs both offer dollar-for-dollar income reduction and can even qualify you for the $1,000 saver’s credit.

Bonus Tip: Seek professional help. Having an experienced tax professional by your side will not only ease your stress, they can help you find deductions and credits that you were not aware of. Trust American Investment Planners, LLC to help you file your tax return this season.

To schedule an appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

When Can You Expect Your Tax Refund?

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

If you've only filed your tax return recently and were given the good news that you'll be getting a refund, we bet the next thought on your mind is, "when can I expect it?" While unfortunately we can't say you'll receive your refund immediately, the good news is that as long as everything goes smoothly, you can expect to see it soon! 

According to the IRS, most refunds are issued in less than 21 calendar days. That means at the most, you should really only have to wait about three weeks! The IRS even offers a tool called Where's My Refund? that allows you to track the status of your return and see your expected refund date. 

Is there a way to get your refund sooner than the IRS anticipates?

A frequently asked question about tax refunds is centered on calling the IRS to speed up the process. Unfortunately, calling the IRS to inquire about your refund will not help you get it any faster, so you'll need to sit tight! Unless your tax return requires further examination or processing, the "less than 21 calendar days" guideline is your safest bet to follow. However, don't forget to consider how long it takes for your bank to process direct deposits or how long it takes for you to receive your mail, as both of these can certainly impact how long it is before your refund is available for use.

Reasons why you won't see your refund in 21 days or less.

The IRS explains that the following circumstances may cause your refund to be delayed:

1. There are errors with your return.
2. Your return is incomplete.
3. Further review is required.
4. Identity theft or fraud has been noted.
5. You submitted Form 8379, Injured Spouse Allocation.

Should any of the above apply to you, the IRS will contact you via mail to discuss the need for further information.

If you have additional questions about tax refunds or have a concern about this year's tax return, please do not hesitate to contact the team here at American Investment Planners LLC at (516) 932-5130.

Smart Uses For Your Tax Refund

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

We all walk into our tax appointments with a glimmer of hope that the outcome will be receiving a nice refund from Uncle Sam, and when that's the case, it feels like we're on cloud 9. But let's not get too ahead of ourselves - we're sure that just like us, you have some ideas for what you'd do with your tax check, but you shouldn't just go out and spend it without thinking.

If you want to get the most benefit out of your tax refund this year, here are a few things we suggest doing with it:

Add it to your retirement fund: Even if you contribute to your employer's 401(k), you may not be saving as much as you need to for retirement. So, take this extra bit of cash and stash it away in a savings account that you have dedicated to this point of your life. 

Save for college: Have a child at home that you'll be sending off to college soon? If you plan to help cover the cost of tuition, put all or some of your tax refund aside so that you have it ready when the time comes.

Invest: If you've always thought about investing but weren't financially able to before, use your tax refund to get started. But before you do, keep in mind that finding the right investments can be tricky, so you should meet with a financial planner like ourselves to determine a strategy that's right for you!

Pay off debt: Did you make a large purchase recently that's been taking some time to pay off? If so, use your tax refund to reduce how much you still owe! For those of you with expenses that have a high interest rate, consider putting your refund towards those payments so that you can help knock down how much interest you accrue moving forward.

Looking for more ideas on what to do with your tax refund this year? This article from Kiplinger has some answers!

At American Investment Planners LLC, our goal is to help our clients achieve financial security and build a legacy that they can pass on. If you have yet to work with a financial planner, please give us a call at (516) 932-5130 to learn how our products and services can be of help to you.