How Might Current Events Impact Your Income Tax Refund?
If you’re reading this, there’s a good chance you know you need help paying property taxes. In fact, it might even be tax season already, and you’re trying to get everything sorted out before that magical federal filing date of April 15th. However, as of this writing, the federal income tax return due date has been extended to July 15th, 2020 because of the coronavirus, a prime example of how an event can impact your refund.
Across the country, everyone has had to offer a response to COVID-19, with the federal government being chief among them. What does this shift mean for you as a taxpayer, especially in light of your refund? Well, obviously, you have more time to file your return, though waiting will certainly extend the time it takes for the refund to hit your account. In general, the longer it takes to receive your refund, the more of an impact it will have on your ability to use that money for help with property taxes. Remember that, in a typical year, the IRS estimates that you’ll get your refund within 21 days of filing.
Why Would You Use An Income Tax Refund for Help Paying Property Taxes?
Income tax refunds can be used in a variety of ways. While some people tend to think of it as “extra money,” in reality, it’s already yours — the government has just been holding onto it. As such, it’s a great idea to invest this money wisely, maybe by looking at the stock market or a pension fund. Or, many experts recommend paying down debts with your refund to get you back on the right track financially. That’s why a lot of people look to this cash as a way to get help with property taxes.
It’s very easy for life to get in the way and sap your savings of money that you planned to use for property taxes. Medical expenses, rent, repairs…all of these things can impact your ability to pay your tax bill, especially when dealing with uncertain times and a questionable economy. Whether you’re facing property tax delinquency or are already delinquent, you might be expecting a refund from your federal tax return and hope to use it toward your property taxes.
How Do You Know How Much Your Income Tax Refund Will Be?
One reason you might consider using refund money for delinquent property tax help is if you know the amount you have coming back to you. However, it’s essential to note that you really can only estimate your refund amount — there are so many factors that go into it that even the best calculators can miss certain things. That said, the following data can help put you in the right ballpark:
- Personal information relating to your marital status and household
- Earned wages and withholdings from all of your employers
- Additional sources of income you have
- Potential tax deductions, such as charitable contributions
- Any other tax breaks for which you may be eligible
Once you have an estimated refund, you’ll want to calculate the amount of property taxes you expect to pay and compare the two. It’s best to determine this after the tax assessment is completed by the assessor of your local taxing authority. While the property tax rate may not change much from year to year, it’s always good to have the most accurate estimate possible. This helps you gauge how much your refund could even help with property taxes.
Date You Get an Income Tax Refund vs. The Date Property Taxes Are Due
Other than the refund amount, the calendar is probably the biggest issue you’ll face in terms of using your income tax refund for help paying property taxes. If you’re trying to use that exact money, it might not be possible at all. Let’s dig in and see how these dates impact each other.
When Are Property Taxes Due in Texas?
As you may know, your Texas property tax bill is due on January 31st every year. So, if you’re looking to get property tax help in Texas as a way to avoid delinquency, you’d need to have everything squared away before that.
How Soon Can You Get Your Federal Income Tax Refund?
Before you get your refund, you first have to file your yearly tax return and have it processed.To do that, you’ll need all of the appropriate documents from your employer (such as a W-2 form). Most years, employers have until the end of January to provide forms for the previous year’s taxes. Also, the IRS doesn’t usually begin accepting income tax returns until a few days before that. Then, as mentioned, it can take up to 21 days for you to get your refund after it is processed, and even that is not guaranteed.
Does That Mean Your Refund Won’t Help with Property Taxes?
Not exactly. It does mean that it’s basically impossible for you to get your income tax refund in hand before Texas property taxes are due on January 31st. If you were able to estimate your refund in advance, you can budget for it (while accounting for a margin of error) and use what money you do have available (if any) to cover your property taxes in the meantime. Additionally, if you become delinquent (or already are), you can use your refund to pay down the total amount you owe. Just keep in mind that this will include late fees and interest.
Do You Have Any Other Options for Help with Property Taxes?
If you were trying to avoid the tax collector by paying property taxes with your income tax refund, but realize that might mean entering delinquency, it might seem like you’re out of options. But that’s not the case! There are plenty of other ways to get help paying property taxes.
Ways To Get Property Tax Help in Texas
The following are some of the ways you can get property tax assistance in Texas:
- Look into a payment plan
- See if you qualify for a tax exemption or can request tax relief
- File a property tax appeal to protest your tax bill
- Obtain a property tax loan
The latter is where Tax Ease comes into the equation.
Don’t Rely On Your Federal Income Tax Refund — Get Help with Property Taxes Now
Tax Ease has the experience to set you up with a property tax loan that will work for you and give you the relief you need when you need it. Contact us or fill out a tax loan application today to get started. Regardless of the status of your refund, we can help with property taxes.
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