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Using Tax Refunds to Pay off Debt

Posted by Emily Herrington on Jan 26, 2021 9:08:37 AM

Many Americans will receive a tax return this year. While some may be tempted to put a down payment on a new car or renovate a kitchen or bathroom, they really should use that money to pay down their debt. Tax time is the best time for businesses to utilize an experienced collection agency to turn their bad debt into bottom-line revenue.

The standard tax deduction for single filers is $12,400 and $24,800 for married couples filing jointly, and income tax brackets increased in 2020 to account for inflation.

The good news is that 31% of consumers that will receive a refund don’t plan on purchasing new electronics or taking off to the Bahamas, and 68% of those people believe that their refund is a key component of their financial well-being. That being said, a recent survey cited that the next most popular response was that 24% of people intend to use their refund to pay down their debt. 24% may sound low, but what if one quarter of your current bad debt collection accounts could potentially increase by 24% on top of what you’re already gaining by using a reputable agency? Not too shabby, right?

Maybe you haven’t yet partnered with a collection agency. Now is the perfect time! W-2’s are already arriving in mailboxes around the country, and thanks to COVID-19, families are rushing to file taxes to take care of that accumulated debt in 2020.

Don’t rely on hope alone that your patients or customers will do the right thing. Have an agency calling on your accounts regularly, so that we can catch them at just the right time while you’re doing the hard work of building your business, and doing what you do best while we do what we do best.

For more information on how Account Resolution Team can help YOU get your money, call 423-586-7613 or visit www.accountresolutionteam.com

Topics: Collection Strategy, old debt, debt collections, new practice, collection agency, tax refund, get out of debt, how to get out of debt