Thursday, April 5, 2012
Last-Minute Tax Tips for Procrastinators
If you have not completed your taxes yet, here are some stress-relieving ideas:
Don't Procrastinate Anymore - Resist the temptation to put off your taxes until the very last minute. Your return takes time to prepare and your preparer may need to request certain documents from you, which will take additional time.
Don't Panic If You Can't Pay - If you can't immediately pay the taxes you owe, consider some alternatives. You can apply for an IRS installment agreement, suggesting your own monthly payment amount and due date, and getting a reduced late-payment penalty rate. You also have various options for charging your balance on a credit card. There is no IRS fee for credit card payments, but the processing companies charge a convenience fee. Electronic filers with a balance due can file early and authorize the government's financial agent to take the money directly from their checking or savings account on the April due date, with no fee.
Request an Extension of Time to File,- But Pay on Time - If the clock runs out, you can get an automatic six-month extension, bringing the filing date to October 15, 2012. The extension itself does not give you more time to pay any taxes due. You will owe interest on any amount not paid by the April deadline, plus a late-payment penalty if you have not paid at least 90 percent of your total tax by that date. Contact your tax professional for a variety of easy ways to apply for an extension.
To get an estimate of what you owe, you generally have to do a dry run of your tax return—which probably means you will have almost everything you need to file anyway. If they’re 90 percent done, it’s really in your best interest to just get it done and file.