Tips to reduce tax-time stress
Tax preparation doesn’t need to give you a headache – make it easier on yourself! The IRS offers six tips to make your tax filing experience a breeze.
1. Don’t procrastinate. Resist the temptation to put off your taxes until the last minute. Rushing to meet the filing deadline may cause you to overlook potential sources of tax savings and will likely increase your risk of making an error.
2. Visit the IRS website. More than 322 million visits were made to www.irs.gov in 2011. Make “1040 Central” your first stop to check for the latest news and find answers to your tax filing questions.
3. Use Free File. Let Free File (available exclusively on the IRS website) do the hard work with brand-name tax software or online fillable forms. Everyone can find an option to prepare their tax return and e-file for free. If you made $57,000 or less, you qualify for free tax software that is offered through a private-public partnership with manufacturers. If you made more than $57,000 and/or are comfortable preparing your own tax return, there’s Free File Fillable Forms, the electronic versions of IRS paper forms.
4. Try IRS e-file. Last year, 79 percent of taxpayers – 106 million people – used IRS e-file, which is the safest, easiest and most common way to file a tax return. If you owe taxes, you can file immediately and pay later (by the April 17 tax deadline). Best of all, when you combine e-file with direct deposit the IRS can generally issue your refund in as few as 10 days.
5. Don’t panic if you can’t pay. If you can’t pay your full tax liability by the mid-April deadline, you should still file your return by the deadline and pay as much as possible to avoid penalties and interest. More than 75 percent of taxpayers eligible for an Installment Agreement can apply using the web-based Online Payment Agreement application available at the IRS website.
6. Request an extension of time to file – but pay on time. If the deadline clock is ticking, you can get an automatic six-month extension through Oct. 15. However, this extension of time to file, which must be filed or postmarked by the April 17 deadline, does not give you more time to pay any taxes due. If you have not paid at least 90 percent of the total tax due by the April deadline, you may also be subject to an estimated tax penalty. You can obtain an extension through Free File.