Ready for a not so fun fact? The IRS reports that the average American will spend 13 hours and $200 dollars preparing their tax return this year.
This heavy burden of money and time makes it no surprise that tax season stress spills over into the workplace. Now more than ever, employees are turning to their HR teams for help.
You’re a benefits professional, not a financial advisor, though. Is it ok to offer guidance, and if so, how? Here are a few ways you can (legally) lend a hand to your hard-working teams during tax season.
Encourage them to get organized.
Sorting out your financial life for tax time is no easy feat. One simple way to show support to your employees is by helping them keep important dates and documents top of mind.
Add April 15th to your company calendar. Send tax day reminders out with paystubs. Share a friendly Tax Time Documents Checklist. Make it easy to access the forms they’ll need from you (in case they need an additional copy).
This will save your team time in the long run by cutting down on many tax season FAQs that will come knocking at your door.
Remind them to review their withholding.
Are employees withholding too much, too little, or just enough? This is one of the tax season questions that could be stressing them out the most.
The IRS released a new Form W-4 last year (renamed Employee's Withholding Certificate) with some big changes designed to make accurate tax withholding easier for employees. While they’re locked in for this fiscal year already, guiding them towards resources to make the right withholding choices for next year will build tax season confidence in a big way.
Caution: Steer clear of specifically telling them how many deductions to take, and never fill out any forms on their behalf. This is where things can get legally dicey. However, a financial wellbeing program with Certified Financial Planner™ professionals can give this guidance.
Show them the power of pre-tax contributions.
HSA, FSA, 401k. Tax season already throws an assault of acronyms at us. Why not add a few more that could save them a bunch of money?
Employees are starting to better understand these tax-advantaged benefits, but many are not tapping their full potential. Continue the conversation from Open Enrollment through tax season by educating your team on health savings accounts, flexible spending accounts, and their retirement benefits.
For example, employees that didn’t withhold enough last year can make HSA contributions up to the filing due date to avoid tax penalties. Avoid giving one-one-on guidance, though - that’s best left to qualified, unbiased financial professionals.
Help them find discounted or free tax prep resources.
Another great way to take the stress out of tax season? Lessen the financial sting.
Partner up with a well-vetted local tax preparation provider to offer cheaper rates for employees. Or, reach out to the big tax prep software companies to see if they’ll do a corporate rate for your team at scale. Some tax professionals may even do discounted on-site tax preparation at your workplace, which will save employees time, energy and hopefully some cash, too.
Many employees also may be eligible for the IRS Free File services, which can be found here.
Remind them about filing an extension.
Especially when April rolls around, employee tax season stress may reach an all-time high. Keep employees in the know that they can file for an extension if they just can’t meet the deadline.
While it won’t put off tax payment, it’ll at least delay the paperwork part of things until October. Individual tax filers, regardless of income, can use Free File to electronically request an automatic tax-filing extension.
Provide personalized guidance at scale with a financial wellbeing benefit.
Let’s be real. Your time as an HR professional is best spent on initiatives that drive your company’s success, not acting as a tax advisor.
If your workforce shows signs of elevated stress during tax season, or you notice more knocks on your door to talk about W-2s and W-4s it may be time for a strategic solution. That’s where financial wellbeing comes in.
Partnering with programs like LearnLux to offer financial wellbeing will deliver on-demand guidance on taxes, retirement, health insurance, budgeting, saving, investing, and more, directly to employees. With LearnLux’s robust Tax Time content track, employees’ FAQs will be answered with ease.
For more personalized help, trusted Certified Financial Planner™ professionals are just a phone call away. Click here for more info on LearnLux and reach out to our team if you’d like to learn more.