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Sunday, April 14, 2024

Navigating tax season: A guide to financial wellness

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Devyne Harris

As the calendar turns and the scent of spring wafts through the air, it’s time to face the annual ritual that sends shivers down the spine of many: tax season. While the mere thought of filing taxes can induce anxiety for some, understanding its significance and having a grasp of key concepts can alleviate stress and pave the way for financial empowerment.

Filing taxes is not just a legal obligation but also a crucial step in contributing to the functioning of our society. Taxes fund essential public services such as education, infrastructure, healthcare, and social welfare programs. When you file your taxes accurately and on time, you ensure that the government has the necessary resources to support these services, benefiting communities and individuals alike.

Moreover, filing taxes can unlock various financial benefits. For instance, if you’re eligible for tax credits or deductions, such as the Earned Income Tax Credit (EITC) or student loan interest deduction, you could receive a refund or reduce your tax liability. Filing taxes also establishes a record of your income, which can be vital for securing loans, applying for financial aid, or even renting an apartment.

Key Things to Know

Understanding the basics of tax filing can empower you to navigate this season with confidence:

  1. Know Your Filing Status: Your filing status—single, married filing jointly, married filing separately, head of household, or qualifying widow(er)—determines your tax rate and eligibility for certain deductions or credits. Choose the status that accurately reflects your marital and household situation.
  1. Gather Necessary Documents: Before diving into tax preparation, ensure you have all relevant documents handy, including W-2s, 1099s, investment statements, and receipts for deductible expenses like charitable donations or medical expenses.
  1. Be Aware of Deadlines: Mark your calendar with the tax filing deadline, typically April 15th, unless it falls on a weekend or holiday. If you need more time, consider filing for an extension, but remember that an extension to file doesn’t extend the deadline for paying any taxes owed.
  1. Explore Deductions and Credits: Familiarize yourself with available deductions and credits that could reduce your tax bill or increase your refund. Common deductions include those for mortgage interest, property taxes, and retirement contributions, while credits like the Child Tax Credit and Child and Dependent Care Credit can provide substantial savings.
  1. Consider Seeking Professional Help: While many individuals can successfully file their taxes independently, complex financial situations may benefit from professional guidance. Tax professionals can help navigate intricate tax laws, maximize deductions, and ensure compliance with regulations.

Full Circle by Divinity

For those seeking comprehensive financial services tailored to their unique needs, consider partnering with Full Circle by Divinity. Founded by a local Black woman entrepreneur, Devyne Harris, Full Circle offers holistic financial solutions ranging from credit repair to tax and accounting services.

With a commitment to financial wellness and empowerment, Full Circle goes beyond traditional accounting firms by providing personalized guidance and support to clients at every step of their financial journey. Whether you’re aiming to improve your credit score, optimize your tax strategy, or achieve long-term financial stability, Full Circle’s team of experts is dedicated to helping you realize your goals.

As tax season approaches, remember that filing taxes isn’t just about crunching numbers—it’s an opportunity to take control of your financial future and contribute to the well-being of your community. By understanding the importance of tax compliance and staying informed about key concepts, you can navigate this season with confidence and pave the way for a brighter financial tomorrow.

Embrace tax season as an opportunity for financial empowerment, and consider partnering with Full Circle by Divinity for comprehensive support tailored to your needs.

Devyne Harris is the founder & CEO of Full Circle by Divinity.

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