Last Minute Tax TipsMost of us welcome the middle of April - the weather finally starts to show some of the promise of Spring, letting us know that Summer can't be far behind. For a few harried individuals, however, this time of year is the start of nail-biting, hope-I-didn't-forget-anything dash of paperwork in order to meet the IRS's filing deadline on the 15th. If you're one of these bleary-eyed souls, this last minute guide is for you.Beat the DeadlineIn order to be considered on time, your return must be properly addressed and postmarked no later than April 15. That doesn't mean that you have until the 15th to start your taxes, however. Procrastinating until the last minute can easily cause you to miss potential sources of tax savings and will put you in far greater jeopardy of making mistakes.File a Paperless ReturnFiling your return online can be far easier than putting pen to paper the old fashioned way. A number of professional tax return preparers offer electronic filing of tax returns in addition to their normal return preparation services. In most cases these e-filing services do a good job of guiding you through the entire filing process. Most charge a modest fee and offer a range of additional e-filing products for those who need additional assistance.In addition to being fairly easy, e-filing is the typically the quickest and most accurate method of filing tax return. If you're due a refund, the waiting time for e-filers is half that of paper filers. By filing online you also have the option to have any refund directly deposited into your bank account. Almost 80 million taxpayers filed their returns electronically in last fiscal year.Payment OptionsIf you can't immediately pay the full balance of taxes you owe, there are still alternatives available to you. You can apply for an IRS installment agreement, using their new Online Payment Agreement application on IRS.gov. This Web-based tool allows qualified taxpayers or their official representatives to self-qualify, apply for, and receive immediate notification of approval. You also have a number of options for charging your balance on a credit or debit card. There is no IRS fee for credit or debit card payments, but the processing companies will charge a convenience fee. E-filers with a balance due may pay their taxes directly from their checking or savings account on the April due date with no service fee.ExtensionsShould you find that you are unable to file by the due date of your return, you can request an extension of time to file. However, it's important to note that an extension of time to file is not an extension of time to pay. You will owe interest on any past-due tax and you may be subject to a late-payment penalty if payment is not made timely. To receive an automatic 6-month extension of time to file your return, you must file Form 4868 by the due date of your return.Joint ReturnsIf you are married and will be filing a joint return, remember that both husband and wife must sign the return. If your spouse cannot sign (because of disease or injury) and requests that you sign the return, you should sign your spouse's name in the proper place followed by the word "by" your signature, followed by the word "husband" or "wife". Don't forget to also sign in the space provided for your own signature. In addition, you must attach a statement that includes the form number of the return you are filing, the tax year, the reason your spouse cannot sign the return, and a statement that your spouse has agreed to your signing for him or her.Special RebateUnless you've been sleepwalking for the last few months, you probably have heard about the individual rebates that many taxpayers will be receiving as part of an economic stimulus package. Under the Economic Stimulus Act of 2008, some 130 million Americans will receive checks entirely separate from normal refunds. The most common questions: who will be getting money, how much and when?If you earned more than $3,000 for the 2007 tax year but owed no taxes, you will get some money back. If you had any net tax liability for 2007 you should likewise seem some form of rebate. In many cases there is a rebate bonus for taxpayers who claim children (those under 17 years of age). Non resident aliens are excluded from the rebate program. The rebate amount begins filing out if your adjusted gross income is over a certain threshold ($75,000 for single filers, $150,000 for married couples filing jointly).In general, the basic rebate amounts break down as follows:Individual taxpayers could receive rebate checks ranging from $300 to $600.Married couples will get up to $1,200.Most individuals who have income of $3,000 but who do not have to file a return will get $300.Some taxpayers with children will receive an additional $300 per child.Because the IRS needs time to the normal glut of 1040s from filing season, checks will not start being issued until May at the earliest. According to the IRS, payment date will be based on the last two-digits of your Social Security number, with checks being mailed between mid-May and Mid-July. If you previously requested that your standard tax return's refund be directly deposited to your bank account, the additional rebate will likewise come through as a direct deposit.Go to the ProsIf you've decided to wait until the last minute to file your tax return, chances are this isn't the first time in your life that someone has told you to seek professional help. In all seriousness, when the deadline is fast approaching obtaining a seasoned tax expert is a sound decision. The extra care, protection and expertise that a knowledgeable tax preparer can provide are more than worth the cost of their services.
Comments