Ten Days to Tax Day

Now that April 15 is within shouting distance, let’s take a look at some deadline related items and reminders.

This is one deadline that doesn’t move!

First and foremost, get your taxes filed by April 15. Missing the deadline is something that can be avoided and should be. If you have a balance due and don’t file a tax return by April 15, then you'll be hit with a failure to file penalty, along with interest on the unpaid taxes. If you can’t meet this deadline to submit a finalized return, then request and extension of time to file. In order to request an automatic six-month extension, you will need to file Form 4868 and this form needs to be submitted by April 15. This will be push your filing deadline back to October 15. An important aspect of filing an extension is to remember that it only extends your time to file, not your time to pay. Therefore, if you owe the tax man, then you will need to pay at the time you file the extension or you will face a non-payment penalty. One last aspect to remember, is that if you are mailing your returns in on April 15, be aware of your post office closing times, expect crowds, and plan appropriately. Further, using a certified mail method is recommended in order have verified proof that your tax returns or extensions were filed timely.

Direct Deposit for Refunds

If you are part of the population lucky enough to be due a refund this year, then consider Direct Deposit. Your direct deposit information (checking or savings) can be included in your return, thus allowing you to receive an expedited refund versus receiving a paper check. Further, direct deposits also remove the chance that your paper check gets lost or stolen in the mail, so many consider this a safer method of receiving your refund. One last thing to note in this area is that you even have the capability of splitting your direct deposits into as many as 3 different bank accounts.

Haste makes Waste

Don’t fall prey to the rush and heat of April 15th looming. It is important that you aren’t overlooking the details. Recheck your figures, recheck your calculations. Simple things such as confirming that your Social Security Number, all signatures are completed where needed, and attaching the appropriate forms, statements and schedules can’t be overlooked. If your feeling overwhelmed with some of these details, then call your local CPA and see how they can assist.

Can’t Pay? There are options

If your tax liability is more than you have the capability of paying, there are options out there for you to explore. The answer is not to simply not pay. The IRS will allow an installment agreement to be put into place that makes provisions for you to pay any remaining balance in monthly installments. Per IRS regulations, if you owe $25,000 or less, you can even apply for such a payment plan online or by attaching Form 9465 – Installment Agreement Request – to your completed tax return. In doing either of these options, you would list the amount of your proposed monthly payment and the date you wish to make your payment each month. There is a IRS charge for this service of $105 for setting up the agreement or only $52 if you deduct the payments directly from your bank account. This is not an interest free loan for the IRS. You will have interest plus a late payment penalty on the unpaid taxes for each month after the due date that the tax is left unpaid.

April 15 always comes around quicker than we think. If you are feeling overwhelmed and need help, your local CPA is always a good place to start. As Benjamin Franklin is credited with phrasing, “By failing to prepare, you are preparing to fail.” Take the time to meet the deadlines and make your tax life simpler and a smoother process.

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