LAST-MINUTE TAX TIPS
#1 - DON'T PANIC, BUT DON'T PROCRASTINATE ANY LONGER
· April 15 is the deadline this year.
· Make sure you have gathered all tax-related documents so you are able to file a complete return.
· Look at your 2012 tax return as a guide for gathering information for your 2013 return.
· Consider requesting an extension of time to file if you cannot obtain everything you need. However, remember that an extension of time to file a return is not an extension of time to pay taxes.
· Visit www.irs.gov and/or consult a professional tax preparer.
#2 - FILE YOUR RETURN EVEN IF YOU CANNOT PAY
· There is an onerous failure-to-file penalty in addition to a failure-to-pay penalty. Failure to file a return could increase your liability by 25% or more.
· Even if you cannot pay the full amount due, you should file the actual return or request an extension by April 15.
· Pay as much of your 2013 tax liability as possible by April 15.
· The IRS frequently grants installment agreements if the taxpayer makes the appropriate request.
· Paying via credit card is an option. However, there is a transaction processing cost of roughly 2% to 4%.
#3 - REPORT ALL TAXABLE INCOME
· The IRS receives the information from Forms W-2, 1099, 1098, etc. and uses computers to match this information with the amounts filed on tax returns.
· If information from W-2s, 1099s and other documents is not reported on the proper form and according to the correct method, the IRS will easily identify discrepancies and will issue a notice to the taxpayer.
· If you receive a W-2, 1099 or other form that is inaccurate, you should contact the issuer to request that they submit a corrected form to the IRS.
#4 - AVOID COMMON PROBLEMS
· Don't forget the Earned Income Credit. However, you must ensure that you are eligible for this credit.
· Mathematical mistakes are one of the most common reasons people receive an inquiry from the IRS.
· A math error will generate a tax notice and increases the possibility of a tax return audit.
· Triple check Social Security numbers for the taxpayer, spouse and/or dependents.
· Be sure to use the proper filing status.
· Don't forget to sign and date the return and include sufficient postage.
· The best solution is to use a professional preparer or software solution that will allow you to file electronically.
· Evaluate potential adjustments to your 2014 withholding and/or the need to pay quarterly tax estimates.
#5 - DON'T BE AFRAID TO EXTEND YOUR RETURN
· The IRS will automatically extend your tax return due date to October 15 if you file Form 4868 by April 15.
· A valid extension allows self-employed taxpayers to deduct certain retirement plan contributions on their 2013 tax return if the contribution is made by the extended filing date of October 15, 2014.