Money Saving Tips / Wealth & Prosperity

Final Countdown to April 15

Illinois CPA Society Answers Last Minute Tax Questions

This is it. There are only a few days left to finish your taxes. Whether you’re a procrastinator by nature, or you’ve stalled just because you dread filing (or paying) taxes, there’s no avoiding the April 15 deadline.  If you count yourself among those who have waited until the last minute, the Illinois CPA Society offers answers to some of your last minute questions:

What should be double-checked on the return? Don’t forget the obvious. Even if you e-file, print and check the return before mailing and be sure to print a final copy, too. Check the math, check to see if you’ve put the right numbers in the right places, check to see that your social security number is correct and that you (and your spouse) sign and date the return.  Make sure all the necessary forms are attached.

What’s the penalty for filing a return late? If you owe money, always file a tax return on time or file for an extension. Penalties for late filing can range from five percent a month up to a maximum of 25 percent of the amount of tax due on a late return.

How do I file for an extension? You can get a six-month extension by using Form 4868 available electronically or in a printable version from the IRS web site, www.irs.gov. But it’s not an extension of the time to pay. You still need to estimate what you might owe and pay any taxes due by the April 15th deadline. Also check for state filing extension requirements.

Can I charge my taxes? Taxes can be paid using a debit or credit card, but keep in mind if you can’t pay the card balance in full you end up paying a significant amount in interest and fees. The interest rate on your credit card is probably higher than the IRS interest rate for installments, so see if you’re eligible for an installment agreement to arrange a monthly payment plan with the IRS; visit www.irs.gov for more information.

What if I can’t pay?  First of all, don’t ignore the situation by not filing a return. File the return by April 15th and pay as much as you can by the deadline to avoid penalties. Work with the IRS. Although you would still have to pay interest and possibly a late payment penalty, see if you’re eligible for a payment plan. The IRS has also eased its rules on settlements. Detailed financial statements must be filed, but depending on your situation, you may be able to work out a compromise with the IRS. Taxpayers who are unemployed or struggling financially should contact the IRS at 800-829-1040 or visit the Tax Center to Assist Unemployed Taxpayers on the IRS site.

How soon can I expect a refund? Those who e-file will get their returns processed more quickly. If you file electronically and choose to have your refund deposited directly into your bank account, you could have your money in as few as 10 days.  With other filing methods it may be about four to six weeks before you receive a check.

Where can I get help? The IRS web site (www.irs.gov) has forms, publications and information and offers assistance though their Volunteer Income Tax Assistance Program (VITA). There are also other agencies that might be able to help such as AARP (American Association of Retired Persons) which provides free volunteer-run tax assistance and other local groups in your area. The Illinois CPA Society offers free personal income tax preparation to members of the U.S. Armed Forces who were on active duty in a combat zone or recently returned from combat.

Remember you can e-file your return 24 hours a day, any day of the week. Visit the Illinois CPA Society site – www.icpas.org – for more information including direct links to IRS topics. The Society’s site also has a “Find a CPA” directory if you want to start planning now to be better prepared for next tax season.

The Illinois CPA Society, founded in 1903, is the fifth largest state CPA society in the nation, with more than 24,000 members. It is the premier professional organization that represents CPAs in Illinois. During its over 100 years of existence, the Society has advanced the highest ethical and financial standards of the profession, and has been a leader in educating the public on financial issues.

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One Comment

  1. One thing to add: your best option is to file an extension online. That way you’re guaranteed to get a response from the IRS and can re-file if your request is rejected. If, on the other hand, you choose to send the IRS your request through the mail, you will never hear anything back from them. That means your extension request may never get to the IRS or it could be rejected. In the mean time you’re accumulating late filing penalties without even knowing it. By the way, this also includes the IRS’ freefile. That will tell you your request was rejected, but it won’t give you the reason why.

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