Today is April 15th Tax Day. This is an important financial day for most people. But now that you have filed your taxes, what should you do next?
1.) Understand what happened. If you ended up owing taxes, understand why. You obviously did not have enough taxes withheld throughout the year. Plan so that this does not happen again next year. Talk with your tax preparer about this and set up a plan to make sure more taxes are withheld. Also, if you received a big tax refund this year, you should plan better for next year too. The goal is to break even, not to get a big tax refund or in other words give the federal government an interest free loan for a year.
2.) Store properly. Keep copies of your tax returns going back at least 3 to 5 years for your financial records. If there are ever any questions from the IRS or from a financial advisor, you will have ready access to these documents.
3.) Protect yourself against identity theft. Tax returns are a huge door into your financial world; they contain your address, social security number and employment information, everything an identity thief would need to cause trouble in your life. Be sure to protect your information. Pick up your copies from your tax preparer, don’t have them mailed and be sure that copies are securely stored. Finally, be sure that your tax preparer keeps their copy in a secure place as well.
4.) Discuss payment options. If you owe taxes and cannot pay it off in full right now, get on a payment plan and work aggressively and quickly to pay it off. The IRS charges interest and penalties on unpaid taxes so make paying it off a priority.
Black Enterprise Columnist Jennifer Streaks is a Financial Expert, Author & Pundit. Continue the conversation by visiting her website www.JenniferStreaks.com or following her on twitter @JStreaks.