Did you know you have until April 18th, 2016 to claim your 2012 tax refund?
If you didn’t know, then this information might feel a little like finding a $5 bill in an old winter coat. With that in mind, you’re probably thinking about how you can spend it, right? Before I get into the great things you could put that extra money towards, it’s important to remember that your tax refund is still money that you earned. You’re receiving a refund because more tax was withheld throughout the year than was needed to cover the taxes you owed to the IRS. So depending how your 2012 tax situation shakes out, you might be owed a refund, or you might owe back tax if not enough money was withheld. Given that, you should file any past due tax returns ASAP – especially with the chance to get an unclaimed 2012 refund slipping away soon.
Whether you’re saving or spending, make sure you do it right!
1. Catch up on bills.
Sometimes it’s the little things in life that make the biggest impact. Using your tax refund to stay up to date on monthly bills and avoid late fees and interest is such a great way to eliminate stress. Then you can save up the remainder and put it towards that oh-so-necessary vacation you’ve been meaning to take.
2. Start an emergency fund.
Suppose your car breaks down and insurance won’t cover it. Maybe your boss crunches the numbers and realizes that he can’t afford to fund your position anymore. In a world so surprising, you should always hope for the best but prepare for the worst. This is why setting aside a cushion of savings might be a good idea. Financial experts suggest maintaining a savings large enough to cover three to six months’ worth of household spending. You may be thinking that there’s no way that your tax refund will cover that. Maybe not, but you have to start somewhere.
3. Pay off school loans.
Time has flown and it’s been years since you’ve worn a graduation cap or taken a multiple choice test. Unfortunately, your debt situation says differently. If you’re still knee-deep in college loans, a tax refund is the perfect way to pay some of those off or even just increase your monthly payments.
4. Buy an experience.
These days, it’s all about having the newest smartphone and making sure you have at least a dozen pairs of shoes to choose from when getting dressed in the morning. In a world like ours, it’s way too easy to get wrapped up in the ‘things’. Use your refund to buy an experience you’ll remember forever. Whether this is a solo trip to Morocco or a weekend trip to the beach with friends, the memories will last longer than a trip to the mall.
5. Thank the people in your life.
Do your parents slip a crisp $20 bill in your purse when you’re not looking? Did your best friend take a few personal days off to help you move into your new apartment? Whoever is there for you in your life, let them know you appreciate them. Treat a friend to dinner. Send your mom her favorite flowers…just because. Not to mention, you’ll most likely not be spending your entire tax refund on a little act of kindness.
6. Add to your Retirement Fund.
Does your company offer an IRA, 401K or some other retirement program? If you’re already involved, you can look into increasing the amount you put into it each month. If you haven’t started one yet, then now is the time! With your 2012 tax refund on the way, you’ll be able to lay a nice foundation for the future.
7. Invest in exercise you’ll actually enjoy.
If you’ve always turned down your friend’s offer to try out her exhilarating hot yoga classes because it’s just slightly (very) out of your price range, call your friend for the schedule. If you’ve been dying to see inside the fancy walls of an Equinox, now might be the time. With a little extra cash in your pocket, you can get fit by summertime and actually get excited about it!
8. Start an Etsy shop.
To make money, you have to spend money. This is true with any business; even creating an Etsy shop. If you want to turn your hobby into a money machine, you’re going to need to start somewhere. This usually begins by purchasing supplies, advertising and a place to let your creations come to life. With an extra flow of money, you’ll be able to do this without even dipping into your checking or savings account.
9. Donate to charity.
This is one purchase that can bring a smile to anyone’s face. Every bit counts when donating to organizations in need. Do you know you want to donate but don’t know where to start? Take a look at Charity Navigator. This is a great website that will help you choose the best organization to help out based on your own preferences. You can even donate without leaving the website!
Another plus to this one (as if you need one) is that you can deduct your donation from your taxes next year if the organization is accredited by the IRS.
10. Do a combination of things!
There’s no need to put all your eggs in one basket. Why donate your entire refund when you have unpaid bills of your own right on the kitchen counter (karma only goes so far)? Maybe you want to splurge on a weekend getaway but also add to that emergency fund. If there’s more than one way you’d like to spend your refund money, then by all means, do.
11. Do nothing.
On the flip side, if you haven’t decided how you would like to spend your refund yet, there’s no rush. That’s how regrets unfold. The important thing is that you have your 2012 tax refund in the first place. Decide how you want to spend it later.
To spend your refund, you first have to file your tax return.
In order to follow through with any of these, the first step is to file your 2012 tax return. Don’t panic – It’s easy. Plus, if you have any hesitations, our tax team can be reached by phone or live chat. Follow these easy steps and you’ll be spending that refund in no time!
- Create an account on PriorTax.
- Fill in your tax information.
- Submit your account for review.
- Print out your completed 2012 tax return, and mail it to the IRS.
- Wait for your refund to arrive!
Easy, right? We handle all of the not-so-fun stuff while you get the peace of mind you deserve.