Tax season can be one of the most stressful times for your employees—or it can be a major boost. It all depends what they owe, or what they receive. And while personal finances may be just that—personal—those worries don’t disappear when employees come to work.
Imagine an employee who’s just barely getting by each month. With a modest refund of a few hundred dollars, he could make those repairs his car has been needing, or pay that credit card balance that’s quickly collecting interest. But what if he realizes he listed too many deductions on his W-2, and now he owes money instead?
He doesn’t have savings or an emergency fund. He doesn’t have any room in his budget for a new monthly payment. He’ll have to put off the car repair a little longer and hope it doesn’t break down. He keep making the minimum payment on his credit card, watching the balance grow. And he’ll keep worrying, feeling distracted, struggling to perform his best at work.
Situations like these are why it can make business sense to to help your employees connect with tax programs like Volunteer Income Tax Assistance (VITA), or even to offer free tax preparation as an employee benefit. This simple, short-term assistance can make an immediate difference in their financial stability.
Several WorkLab Operating Sites have been offering tax assistance as part of their services for years, with significant results. In Northern Vermont, Working Bridges runs a mobile tax preparation program that in 2018 served 200 employers and completed 237 tax returns, resulting in $485,903 in federal and state refunds.
In 2018, WorkLife Partnership in Colorado helped 288 clients with their taxes, saving them more than $100,000 in filing costs, connecting families with $69,322 in federal EITC, and finding an average refund of $1445.
An integrated counseling approach like WorkLab’s Resource Navigation will also go beyond preparing taxes the immediate year. Navigators can look at a client’s withholding and be sure they’re paying enough all year that they won’t be burdened with a sudden large bill come April. They can help clients plan how to use a large refund so it will have the most impact, like paying down high-interest debt or starting an emergency savings account.
Efforts like these can help frontline workers achieve greater financial stability. With more stability comes less worry and stress, allowing workers to be more focused and productive on the job—contributing the most to the business’s bottom line.