Jan. 20, 2019 – Jackson Heights, NEW YORK
By Gloria Diaz and the Financial Clinic Coaching Team, The Financial Clinic
Tax season has begun, and now is the time when many families are thinking about their 2019 financial goals. Organizations throughout the city offer free tax preparation for members of the community. In Western Queens, these organizations include The Financial Clinic, Urban Upbound, and Chhaya CDC.
Last tax season, the Financial Clinic worked with many families to put a portion of their tax refund into 529 accounts to save for their children’s college education.
Because your child was enrolled in the Save for College Program, you can open your own college savings account—either a 529 account or a bank account—so you, your family, and your friends can save money toward your child’s future. When you do, you can also earn more money toward your child’s NYC Scholarship Account. This is a great opportunity to get started early and make sure your child has as much savings as possible by the time they finish high school.
At the Financial Clinic, we believe that almost anyone has the ability to save for college and career training. As a result, the overwhelming majority of New Yorkers can benefit from opening a 529 plan and saving part of their tax refund at tax time.
We’re excited to announce that you can now automatically split your tax refund into your own 529 account through Refund529! And when you do it as part of the Save for College Program, you can earn up to $175 more in scholarship funds.
It’s easy to split your tax refund this tax season. Here’s how to take advantage of all the rewards and benefits of splitting your tax refund and how the Financial Clinic can help:
1. Schedule an Appointment and Visit a VITA Site for Free Tax Preparation
VITA Sites are free tax preparation sites located in District 30 and throughout New York City. The experienced preparers at VITA sites are IRS certified and will help prepare taxes for your family for free if your household income is under $55,000. To schedule a free tax appointment, call 311.
The Financial Clinic offers tax prep at Make the Road New York (92-10 Roosevelt Ave, Flushing, NY 11373) on Fridays and Saturdays during tax season. To schedule an appointment at Make the Road in Jackson Heights, call 718-565-8500.
To find other free tax preparation sites in the area, check out this map of NYC Free Tax Prep sites or call 311.
2. Make Sure to Complete the 3 Building Blocks So You Have an Account Where You Can Deposit Your Tax Refund and Earn Rewards
3. Ask Your Tax Preparer About Refund529
Ask your tax preparer to use form IT-195 to deposit part of your state tax refund into a 529 account. Decide how much of your tax refund you want to dedicate toward your children’s college savings account. Bring your 529 account number and routing number to your appointment so you can make the deposit.
4. Double Your Savings with the NYC Kids RISE Savings Match
Remember, once you have completed the 3 Building Blocks, NYC Kids RISE will match the next $100 you save dollar-for-dollar. The money you deposit from your tax refund into your 529 account will count toward the Savings Match. This means you can earn up to $100 more in scholarship money when you split your tax refund!
5. Start Thinking Now About How Much You Want to Save Into Your College Savings Account for the Rest of the Year
You can visit an NYC Financial Empowerment Center to meet with a professional financial counselor about how college savings could fit into your overall budget and financial plans. That includes our Center at Make the Road New York in Jackson Heights. It also includes Urban Upbound in Long Island City and Neighborhood Trust Financial Partners at Neighborhood Housing Services in Woodside. Tax time is a great time to think about your finances and plan for the future!
6. Avoid Early Filing Scams or Refund Anticipation Loans
There are some tax preparers and companies who try to take advantage of families who want to access their tax refunds early. These organizations charge high fees (more than 100% annual interest rate in many cases) and often take a large portion of the tax refunds meant for families. Please avoid these loans and scams at all costs.
The earliest deposits of your tax refunds from the IRS come in late January or early February. If a preparer offers to give you a refund before then, be cautious. It may be a scam or a high fee loan. The best practice is to decline any offer for tax refund loans.
7. Watch Your Savings Grow, and Talk to Your Children About Their 529 Accounts and How You Are Saving for Their Future
Make sure your children know how you are saving and planning for college and career training through the Save for College Program.
I’m ready to split my tax refund. What should I do now?
- Finish the 3 Building Blocks (more info at this link) so you are ready to continue saving and earn the Savings Match (more info at this link).
- Then, schedule your appointment for free tax preparation at a VITA site, and split your tax refund this year!
Gloria Diaz is a financial coach with The Financial Clinic at Make the Road New York.