Tips for last Minute Tax Filers
There is a song that can be heard each December that contains the lyrics, “When Christmas Day is here, the most wonderful time of the year”. Would it not be magnificent if the Internal Revenue Service (IRS) could come up with a catchy jingle to coincide with April 15? Well, the fact of the matter is that probably will never happen as taxpayers do not find tax filing deadline day as a day filled with joy and love.
It is quite the opposite, with folks panicking to get paperwork filled out and get it mailed before the midnight deadline to file. Each year on this fateful date, one can turn to the 11 o’clock news and see a long line of cars and people, driving up and dropping off returns at the local post office, in hopes of heading off unwanted IRS penalties. With that fact in mind, here are some tips for those weary souls who wait till the last minute to file.
First off, how about cutting the post office out of the equation all together? There is no rule on the IRS books that says taxpayers must submit their taxes via the mail. In fact, with this being the 21st century, the agency would much rather have those last minute filers submitting online. By using the IRS’ Free File system, citizens can cut out all the lines, but it also has a couple of other advantages for those that e-file.
First, filing online means that those due a refund will get it quicker. When e-filing, make sure also to select the direct deposit option, because it means that the refund will get in a bank account quicker. There is also some talk this year that refunds were getting to some filers within two weeks. For those that like to track where their money is e-filing allows the taxpayer to track their refund within 72 hours of the time that the return was filed. For a government agency, it is hard to find anything quicker than that!
Another key tip is to be thorough in checking all numbers on the return. Putting in a wrong number can have devastating consequences, especially if one was due a refund. This is not about just checking the figures that make up income or taxes paid. One should also be checking things like social security numbers. Everyone knows how valuable deductions can be, especially when a family has three or four children. If one files their return and a digit is wrong on a Social Security number, say goodbye to that deduction. So rule two is, before hitting submit, make sure all the numbers fit!
Please do not miss out on opportunities that the IRS allows to obtain credits or increase deductions. Remember, all of these things can mean more money in the pocket, or lessen the amount that is owed to the government. If one has a couple of thousand dollars left around, talk to a financial advisor about signing up for an IRA. That is a terrific deduction that taxpayers can sign up for all the way till April 15. There are other things to check for as well, especially if one is not using a CPA to do taxes. Check out education credits and any charitable contributions made, as well.
Perhaps the most important tip is to make sure that something is done by the deadline. If one is unsure of something, file a Form 4868 by midnight of April 15. That is the form needed to get an extension, which gives the taxpayer another six months to get their paperwork submitted. Now, be clear though that extensions if for getting the paperwork in, not paying the taxes owed. One should make sure to still send the IRS a payment for the estimated taxes owed, so as to avoid added penalties. The IRS notes that it must be at least 90 percent accurate to keep the taxpayer from incurring a penalty down the road.