Financial Success: Tax Season

Financial success is something many of us strive to achieve. But it’s not hard to notice the trend in many households, including Haitian households, where people long for the income tax check to come in the mail come April (or earlier).

If they only understood what it really means when you receive a large income tax refund check.

Don’t be disillusioned about Tax Refunds. The money was yours all along…Uncle Sam was just holding it for you.

Dave Ramsey is a financial guru, who tells it like it is and holds nothing back. After taking his course back in 2014, I learned that the big refund check you receive every year is actually excess money that you’ve been giving Uncle Sam. BAM! (as fireworks sparkle in the sky)

Let me allow that to sink in a bit…….

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Yes. You are overpaying the government. Which means you could’ve had more money to put into your savings or spend on important things throughout the year rather than giving it away to Uncle Sam. (high five for knowledge).

According to the IRS,

“What is a tax refund? A Federal tax refund is basically a refund from the IRS because you paid more in taxes than you owed for the year. This can happen if too much money is withheld from your paychecks (called withholding tax) and it adds up to more than your total tax liability for the year.

You can control your tax refund amount by managing your withholding tax properly. In general, the more money that is withheld from your wages throughout the year, the greater your tax refund may be because you’ve essentially overpaid the IRS.”

Now tell me why do we get so excited when tax season rolls around?

It is important to “roll” that extra money into paying off your debt, putting it into a savings account, IRA, investments, your business etc. because then it actually benefits you in the long run. Tax refund checks are typically used as splurge money and are often seen as ‘extra’ money.

On your journey to success, educate yourself on tax refunds and all things financial so that you are better prepared to manage your finances.

Be successful!