Consider a Tax Marketing Program

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Consider a Tax Marketing Program

by William J Neylan III

President and CEO of Tax Max

With unemployment benefits, Advanced Child Tax Credit payments, and federal stimulus checks a thing of the past, consumers have seen their liquid cash position deteriorate to almost $0.

Now add inflation into the mix. Higher food prices, higher rent, higher gas prices, higher car prices, higher energy prices, and higher interest rates have left the consumer at a breaking point. They are financially stressed to the max and may only have $9 to pay $10 worth of financial obligations.

Consumers are looking for the next big government check. That is their upcoming tax refund, which is only a few months away. We usually start fielding phone calls towards the end of December about when consumers can tap into their upcoming refund. We are actually starting to receive those phone calls already, and this is the earliest that I can remember.

What does this mean if I am a car dealer?

These calls indicate that some consumers might soon go back to public transportation, such as taking the bus or relying on rideshare services. This means that you will have fewer people looking to buy a car. And those consumers that do want to buy a car will probably struggle to make the full down payment that is required by the dealer. Customers that have an existing loan with a BHPH dealer are starting to struggle when it comes to making their car payments.

One potential solution is a tax marketing program.

W h a t i s a t a x m a r k e t i n g p r o g r a m ?

A tax marketing program is a program where a dealer can advertise for a customer to bring in their W2 in January, February, and March, and their tax partner can file the customer’s tax return and send the refunds to the dealership to use as a down payment. With a Refund Advance product, a customer can apply for a Refund Advance, and the same day, if approved, a consumer can access up to $6000 of their refund that day while on the car lot. There’s your down payment.

Can any dealership type do this?

Yes. If you are a retail, franchise, or BHPH dealer, you can definitely utilize a tax marketing program. There is no risk, no liability, and no recourse with this sort of program.

W h a t i f I a m a B H P H d e a l e r ?

If you are a BHPH dealer, you can also sell cars all 365 days of the year using the Irregular Payment option. An irregular payment is defined as a balloon payment scheduled in the middle of the contract. With certain DMS systems, you can put 3 special tax season payments in your contract and can reduce your term by up to 21%. That is a game changer in today’s environment.

In addition to collecting large down payments and reducing your term, you can use a tax marketing program to collect on your delinquent accounts. Contact all of your past dues at the end of December and tell them to bring in their W2 for your tax partner to file their return, apply for a Refund Advance, and use the Refund Advance to convert a delinquent account into a current account. Your customers will love this.

C a n I u s e a t a x m a r k e t i n g p r o g r a m f o r r e p a i r n o t e s ?

Yes. All of your repair notes should have a due date of March 15. The customer should agree to pay off their repair using their W2 the following January/February to pay off the repais that the dealership did for them.

Considering today’s economic picture, consumers are managing a lot of financial stress. Consumers are desperate for their tax refund, which is just a few months around the corner. Tax season is back, so make sure you don’t miss out. If you don’t have a tax season plan, it could pass you by this year.